How to Set up Profit and Loss Statement in QuickBooks: 6 Easy Steps

Every business needs to manage its finances properly to make a Profit.

QuickBooks offers businesses a systematic way of keeping Income and Expenditure Records to measure their Profitability. 

In QuickBooks is vital to the sustainability and progress of startups and medium-sized businesses as it helps them make informed decisions regarding their Income and Expenditure.

This article will introduce you to QuickBooks and its Key Features.

Introduction to Profit and Loss Statement in QuickBooks

Quickbooks has 5 major features:

• Cost of Goods Sold (COGS): This refers to the Total Cost Price of the inventory you’ve sold in a specified period of time.
• Revenue: Revenue is the income you’ve earned from selling goods or services.
• Expenses: This is the amount you’ve spent purchasing goods, paying subcontractors, or buying materials for production.
• Gross Profit: Gross Profit is calculated by subtracting your COGS from your monthly revenue.
• Net Profit: Calculate your Net Profit by removing your Expenses from your Gross Profit. Your Net Profit is the exact Profit that your business has made. If your Expenses are higher than your Gross Profit, it means you have incurred a Loss.

Benefits of Using Profit & Loss Statement in QuickBooks

• It allows business owners to develop their reports from the software’s templates instead of creating reports from scratch.
• It is affordable. You can enjoy a wide range of helpful features that QuickBooks offers for as low as $12.50 per month. 
• It offers small business owners the ability to expand their enterprise. Many entrepreneurs need loans to grow their businesses. To get a business loan, you may need to provide your Financial Reports to the credit agency or bank.
• It reduces the amount of time a business owner spends on bookkeeping. Profit and Loss Statement in QuickBooks automates the majority of your accounting workload so that you can spend more time on other areas of your business.
• It lets users enjoy a variety of accounting functions on a single platform.
• A Profit and Loss Statement in QuickBooks incorporates your account with payment tools for processes like Inventory Management and Payroll Administration so that you can take care of your Financial Responsibilities in one place.
• Some third-party tools in QuickBooks are PayPal (for Invoice Creation and Online Payments) and Expensify (for Payroll Administration in medium-sized businesses).

Steps to Set Up Profit and Loss Statement in QuickBooks

Follow the steps below to set up a P&L in QuickBooks:

• Step 1: Create a QuickBooks Account
• Step 2: Find the Profit and Loss Statement in QuickBooks Report Center
• Step 3: Choose the Range
• Step 4: Customize your Profit and Loss Statement in QuickBooks
• Step 5: Start Running the P&L in Quickbooks
• Step 6: Print, Email, or Download your Report

Step 1: Create a QuickBooks Account

Click on the ‘Sign Up’ button on the homepage to get started as shown in the image below.

Step 2: Report Center

Click on the Menu Bar on the left-hand side of your computer screen, and select ‘Reports’. A dropdown menu will appear. Select ‘Report Center’ on the dropdown menu as shown in the image below.

Then, click on ‘Company and Financial’. QuickBooks will present you with various options under ‘Company and Financial’. Scroll to ‘Profit and Loss Report Standard’, and click on it.

Step 3: Choose the Range

You’ll see a list of options on the top of the Profit and Loss Reports page. Click on ‘Dates’, and select a Date Range as shown in the image below. The Date Range is the length of time you want the report to cover.

Step 4: Customize

The essence of customizing this report is to personalize different options to suit your business needs. Apart from the Reporting Period, you can also customize Columns, Accounting Methods, etc. Set your preferences, and save your changes as shown in the image below.

Step 5: Run

Now, click on the ‘Run’ button to finish setting up the Profit and Loss Statement in QuickBooks for your business.

Step 6: Print, Email, or Download your Report

The next step which is the last is to harvest the report by either printing it, sending it to a mail address, or downloading it in the pdf or Excel spreadsheet format.

Conclusion

You can access your Profit and Loss Statement in QuickBooks at the end of each day, week, month, or business year.

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