Format of Income Statement

P & L Pro forma (easy version)

Name of Business Trading and Profit and Loss Account for the year ended 31 December 2010 $ $ Opening stock Sales + + Purchases

+

Less: Purchases returns

+ =

Carriage inwards Less: Stock loss Less: Drawings of stock Less: Closing stock Cost of Sales

Gross profit

Less: Sales returns

=

Or Cash sales Credit sales Total sales

? TL

+ + =

=

Salaries and Wages Rental expenses Carriage outwards Operating expenses Discount allowed Commission expenses

X X X X X X

Gross profit Discounts received

X X

Commission revenue Rental income Interest income

X X

Interest expenses

X

Bad debts recovery

Bad debts

X

Increase in Allowance doubtful debts Depreciation: Machinery

for

X

X X

Decrease in Allowance for doubtful debts

X

Profit on disposal of Office Equipment

X

X

Depreciation: Equipment

X

Loss on disposal of Office Equipment Cash loss Stock loss

X

Net Profit

X X

X