Note:

This section will provide you guidelines on how to prepare income statement of your business.

The statement templates provided, serve as a guide towards bare minimum line items that may be included in the financial statements. Please note that com set of financial statements includes: income statement, balance sheet and cash flows along with explanatory notes. Further, you may seek professional guida for preparation of formal financial statements, if deemed necessary. Entries in this template that are marked in black indicate use of formulae. Please avoid tempering with formulae based entries.

Income Statement (Amount in Rs.)

Year 1 Year 2 Year 3

Sales

This figure is obtained by multiplying number of units sold in a year with the net sales price of the product / service.

Cost of Goods Sold: This includes cost of raw material, labour, and factory overheads incurred during the production for the units sold. (This figure be obtained by multiplying cost per unit with the total number of units sold during the year). In case of service based businesses, cost of delivering services maybe included. Year 1 B C D E Raw material Wages Overheads Cost of Goods Sold The cost of raw material used in production of goods sold. The amount paid to direct labour employed by the business, e.g. production workers in case of a manufacturing concern. The production cost other than direct material and direct labour. (B+C+D) 0 0 0 Year 2 Year 3

Gross Profit

Profit earned from the difference between amount of sales and cost of goods sold. (A-E)

G H I J K L M N O P

Expenditures: Selling, Admin and General expenditure. Paid to workers other than direct labour e.g. managers, Salaries accountant, salesman, peon. Rent Utilities Insurance Advertising Depreciation Other Office Expenditure Others Interest on Loan Sub - Total Rent of the factory or office building (If Any). Amount paid for indirect electricity, telephone, Gas, water bills other than used for production and accounted for in "D". Amount paid as insurance of plant/machinery, office vehicles or any other business assets. Any expenditure incurred for advertising and promotion of your business. Amount of depreciation for the year, charged against fixed assets of the business. Office stationery, entertainment, janitorial services. Any other expenditures related to your business. Interest paid on Short Term (working Capital) and Long Term Loan. (G+H+I+J+K+L+M+N+O) 0 0 0

Operating Income

Gross profit minus Expenditure. (F-P)

Tax

Tax applicable according to the income of the business.

Net Income

Operating Income - Tax Amount. (Q-R)

are income statement of your business.

wards bare minimum line items that may be included in the financial statements. Please note that complete , balance sheet and cash flows along with explanatory notes. Further, you may seek professional guidance d necessary.

e use of formulae. Please avoid tempering with formulae based entries.

Year 4

aw material, labour, and factory overheads incurred during the production for the units sold. (This figure can the total number of units sold during the year). In case of service based businesses, cost of delivering the

Year 4

expenditure.