What is a Profit and Loss Statement?

What is a Profit and Loss Statement?

Hi! This is Rob Kropp from Business Puzzle
Academy, and in this training, we’re going to be focusing on what is a profit loss statement.
But before we do that, if you’re someone who wants to stress less and make a $hitload
more cash in your business, then I’ve got this fantastic guidebook for you that will
allow you to do that in just 90 days. All you have to do is click the link below this
video. You know, it astounds me that there are so many business people out there that
do not understand how to read their profit and loss statement. They think they need to
earn an accounting degree or a finance degree to be able to go and do it, and they feel
so overwhelmed by all the financial statements out there that they delegate that responsibility
to their bookkeeper or accountant, and they bury their head in the sand when it comes
to understanding the profitability of their business. You know, it’s not that difficult.
It’s actually quite simple to read a profit and loss statement. So what we’re going
to be covering off in this training is what is a profit and loss statement, how to interpret
a profit and loss statement, and how often you should be really looking at your profit
and loss statement in your business. You know, profit and loss statement is as it says. It
looks at the profitability or the loss that you’re making within your business in any
given period. And one of the benefits of using this profit and loss, understanding and reviewing
and looking at this profit and loss statement, is really understanding what are the sales
that are going on in that given period? What are the common costs associated with making
those sales or the cost of good sale? It’s about understanding what are my fixed costs
within my business that are actually costing me to operate my business? And then, at the
end of the day, how much profit am I actually making within my business in a month, in a
quarter, or in a six month or yearly period within my business? You know, most business
people measure their business success by how much cash they’ve got in the bank, but they
don’t actually read through their profit and loss and use this as a tool or a guide
to be able to make these decisions or really see at any given time how much profit they
are actually making in their business, right here and now. And after all, making profit
is actually one of the main reasons why most people get into business in the first place.
So a profit and loss really helps you look at different areas of the business. It really
measures the performance or the success or the health of the business at any given period
of time. And it’s also feedback back to the business owner to be able to help them
make much better decisions on how they should operate their business going forward. Now,
when it comes to how often they really should be looking at their profit and loss, I suggest
that at least mid-month they should be looking at their actuals versus budget so you can
change tact halfway through the month if need be. And definitely at the end of each month
we should be reviewing actuals versus budget for the month just gone, and also quarter
to date as well. So really mid-month allows the business owner to be able to cut back
on spending or execute on some strategies in the last couple of weeks to really boost
sales to get those targets, and then definitely at the end of each month to be able to know
what worked and what didn’t work in that month, and then what are we going to do differently
next month to either keep doing what worked or change tact on what didn’t work. Those
are the main areas of how you should really use and interpret and how often you should
be looking at your profit and loss statement in your business. What you need to understand
is there is an art and a science to making profit. Making profit is actually quite simple,
yet it’s not actually as easy as it sounds. Now, everyone wants to stress less and make
a $hitload of cash so they can live life doing what they want, when they want, and how they
want. You’ve actually got two options. You can actually continue to do this on your own
and spend time and energy and your own money trying to work at it yourself, or you can
click the link on the right. What this is going to take you to is a page where I’m
going to give you access to my guidebook, which is going to help you stress less and
make a $hitload more cash in your business, just like one of our students who actually
made 187% increase in profit in just 90 days. This guidebook is going to save you so much
time and money and be able to have access to the principles to make more profit within
your business. So, click the link on the right-hand side of this page straight away and get access
to this guidebook, which will help you stress less and make a $hitload more cash in your
business today.

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