What is a P&L?

A P&L, or Profit and Loss statement, is simply a listing of all your business income and all of your business expenses for a given period of time.  It is sometimes called an Income and Expense statement.  Generally, you first list all of your business income and beneath that, all of your business expenses, such as office rent, telephone, cost of goods sold, salaries, etc.  Each business has many of the same type of expenses, but also some unique to that business.  Every businessman should always generate a monthly P&L, for this tells you how your business is doing and whether you are making a profit or losing money.  When you are audited or want to make a deal with the IRS, they will want to see it for the same reason.