Profit and Loss account or Income StatementProfit and loss account or also known as the income statement is one of the major financial statements (others include: balance sheet, the cash flow statement, the statement of stockholder’s equity).
Profit and loss account shows the profitability of a company in a given period of time. There are certain elements in the P&L which refer to revenues or gains from a certain type of activity or expenses and losses:
Take this short quiz to check what you already know: 1. Amounts earned by a company in its main operating activities are: a. Revenues b. Gains 2. A company sells a car that is no longer used in its business. The amount received is more than the book value of the asset. The company will report a(an): a. Expense b. Gain c. Loss d. Revenue 3. Is a company’s Interest Expense: a. an operating expense or b. a non-operating expense? 4. Net Sales minus the Cost of Goods Sold (COGS) equals: a. Gross profit b. Net income 5. Gross profit minus Operating expenses is also known as: a. Net income b. Operating income Now check your answers below. Would you like to learn more about accounting in English? Contact me. Key: 1. a/ 2 b / 3 b/ 4 a/ 5 b Glossary: Profit and loss account (P&L) or Income Statement – Rachunek Zysków I Strat Profitability – rentowność Revenues – przychody Gains – zyski finansowe Expenses – wydatki Losses – straty Operating activity – działalność operacyjna Investing activity – działalność inwestycyjna Financial activity – działalność finansowa Single-step – format uproszczony Multiple-step – format kalkulacyjny Net income – przychody netto Cost of goods sold – koszt sprzedanych towarów Book value – wartość księgowa Interest - odsetki
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AuthorKatarzyna Sawicz Key facts:
- teacher of English - interpreter PL-EN, EN-PL - B.A in English Linguistics, M.A in Linguistics, Sworn and Business Translations, Financial Analysis and Reporting - over 18 years experience teaching and designing materials - experience teaching online to individuals and small groups - experience teaching in-company - 3500+ hours of online lessons Archives
August 2020
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