Free tool · Money & pricing
Profit and loss statement template
A profit and loss statement (P&L, or income statement) lists revenue, subtracts the cost of goods sold to get gross profit, then subtracts operating expenses, interest and taxes to get net profit. Fill in the template below — add or remove lines, switch between monthly and annual — then download it as a CSV or print it to PDF.
Revenue
Cost of goods sold
Operating expenses
My Business
Profit and loss statement · October 2026
Net profit
$4,264
Net margin 17.8%.
- Total revenue
- $24,000
- Cost of goods sold
- −$7,920
- Gross profit
- $16,080
- Gross margin
- 67.0%
- Operating expenses
- −$10,600
- Operating profit (EBIT)
- $5,480
- Interest
- −$150
- Income tax (estimate)
- −$1,066
- Net profit
- $4,264
How the P&L adds up
- Revenue = Sum of revenue lines
- Gross profit = Revenue − Sum of COGS lines; Gross margin = Gross profit ÷ Revenue × 100
- Operating profit = Gross profit − Sum of operating expense lines; Operating margin = Operating profit ÷ Revenue × 100
- Net profit = Operating profit − Interest − Income tax (tax rate × pre-tax profit); Net margin = Net profit ÷ Revenue × 100
- Annual view = Monthly figures × 12
How to fill in each section
Revenue — every source of sales, split however helps you: product lines, services, wholesale vs retail. Record it net of refunds and discounts.
Cost of goods sold — costs that rise with each sale: ingredients, inventory, materials, packaging, merchant fees, contractor labor on jobs.
Operating expenses — the cost of keeping the doors open: rent, software, insurance, marketing, salaries, vehicle costs, accounting.
Interest & taxes — loan interest and income taxes sit below operating profit so you can judge the business before financing decisions.
Worked example: one month at a home bakery
Revenue: custom cakes $4,200, cookies at a farmers market $1,800 — $6,000 total. COGS: ingredients $1,350, boxes and boards $310, card fees $180 — $1,840. Gross profit is $4,160, a 69.3% gross margin. Operating expenses: market stall $240, website and software $65, insurance $90, ads $300, kitchen equipment repairs $105 — $800. Operating profit is $3,360 (56%). Interest on an oven loan of $45 and a $700 tax set-aside leave $2,615 net profit, a 43.6% net margin. Switching to annual view shows $31,380 a year at this pace.
Using your P&L to make decisions
- Compare gross margin month to month — a drop usually means ingredient or supplier prices rose faster than your prices.
- Watch operating expenses as a share of revenue; subscriptions and small recurring costs creep up quietly.
- Lenders and buyers usually ask for P&Ls, often with the last two or three years, so keep a monthly copy.
- A P&L shows profit, not cash. Inventory purchases, loan principal and owner draws affect your bank balance without appearing here.
Frequently asked questions
What is a profit and loss statement?
A financial report that shows revenue, costs and expenses over a period — usually a month, quarter or year — and the resulting profit or loss. It is also called an income statement or P&L.
How do I make a simple P&L for a small business?
List all revenue for the period, subtract the direct cost of what you sold to get gross profit, subtract operating expenses to get operating profit, then subtract interest and taxes to get net profit. The template above does the arithmetic for you.
What is the difference between gross profit and net profit?
Gross profit subtracts only the cost of goods sold from revenue. Net profit subtracts every expense, including overhead, interest and taxes.
Do I need a P&L if I am a sole proprietor?
There is no general requirement to produce a formal P&L, but you need the same numbers to file your taxes (Schedule C for US sole proprietors), apply for loans and see whether the business is working.
Can I download this P&L template?
Yes. Use Download CSV to open it in Excel, Google Sheets or Numbers, or Print / save as PDF to keep or share a formatted copy.