Profit and loss (P&L)

• Financial performance calculated for one year
• 1st April - 31st March is mostly taken as Finalcial year
• P&L for year ended 31st March 2020
  • P&L for FY 2019-2020

Income

Revenue from Operations

• Revenue from operation
  • Revenue from core operation
  • Eg: Sale of products
• Other operation revenue
  • Revenue operation linked with core operation
  • Eg:
    • Scrap sales
    • Export incentives

Other income

• Bank deposit
• Divident income
• Non-operating income

Expense

• Cost of Materials Consumed
  • Inventories add
• Purchases of Stock-in-Trade
  • Traded goods
• Employee Benifit expense
  • Salaries and wages
  • Staff welfare expense – staff tour
• Finance Cost
  • Interest expense on Loans(debt) etc..
• Depreciation, Amortisation and Impariment expense
  • Depreciation
    • Eg: Building
    • It’s done for Tangible asset
    • After Z yrs value will be Y from X
    • (X-Y)/Z — every yr this expense will be added
  • Amortisation
    • Eg: Software licence
    • It’s done for Intangible asset
    • After Z yrs value will be 0 from X
    • X/Z — every yr this expense will be added
  • Impariment
    • Eg: Building collapsed
    • Asset value reduction other than depriciation or amortisation
• Other Expense
  • Insurance fee
  • Audit expense
  • Donation

Types of Expenditure

• Capital expenditure
  • Goods that don't get exhausted, but last long
  • Eg: Tables, chairs, AC, House
  • Included in Assets
• Revenue expenditure
  • Goods that get exhausted within short time
  • Eg: Vegi or food, Labour wages, Bills, maintaince cost
  • Included in Profit and loss