In this lesson, you will learn how to generate the profit and loss statement (P&L statement) under Financial Statements in Parsimony.com. A P&L statement is a financial statement that shows a company’s revenues, expenses, and net income over a specific period.
To generate the P&L statement, you will first need to select the appropriate date range and financial year. Then, you will need to select the accounts that you want to include in the statement. Parsimony.com allows you to select accounts based on different parameters such as account type, account group, and account code.
Once you have selected the accounts, Parsimony.com will automatically calculate the revenue, cost of goods sold, and operating expenses based on the account type and group. The net income will be calculated by subtracting the total expenses from the total revenue.
The P&L statement will also show the gross profit margin, which is the difference between the revenue and the cost of goods sold, expressed as a percentage of the revenue. This information is critical to evaluating a company’s profitability.
Parsimony.com also allows you to customize the P&L statement by adding or removing accounts, modifying the account grouping, and changing the format and layout of the statement. This customization feature enables you to generate a P&L statement that best suits your business needs and reporting requirements.
In summary, by completing this lesson, you will learn how to generate the P&L statement in Parsimony.com, which is a crucial financial statement that helps businesses evaluate their financial performance.