Skip to main content

Income statement example

Use our free income statement template to review your business performance, and check out the Transferwise multi-currency business account as a smart way to cut your bank charges.
Example income statementGet a business account
income-statement-template

What is an income statement?

An income statement sets out your company income versus expenses, to help calculate profit. You’ll sometimes see income statements called a profit and loss statement (P&L), statement of operations, or statement of earnings.

Income statements can be created to analyze and compare business performance over a month, a quarter or a year, and are an effective tool to review cash flow and predict future business performance.

Smart business owners use income statements alongside other key financial documents, like the balance sheet and cash flow statement, to check up on and improve the health of their businesses.

what is an income statement

Sample income statement.

A sample income statement in a single step format would look like this.

The single step income statement shows information in a simple format which is suitable for businesses that have relatively simple operations, like small businesses and sole proprietorships. Small businesses often start by reporting their financials with a single-step income statement and switch to the multi-step format once they expand their operations.

Download a single step income statement template →

sample income statement
income-statement

Download your income statement template.

To receive the download link on your email, please enter your email address. When you enter your email, you’ll also be signed up to receive the Wise Business newsletter, our free monthly email packed with handy guides and tips on how to grow your business internationally. You can unsubscribe at any time.

By subscribing, you agree to receive marketing communications from Wise. You can unsubscribe at any time using the link in the footer of our emails. See our privacy policy

The cheap & easy way to manage your international business.

Wise Business is the smart and speedy way to pay and be paid in multiple currencies.

Are you invoicing clients overseas, or working with suppliers based abroad, but waiting around for slow international transfers to finally reach your account? Wise can cut down on the cost and time of international transfers into your multi-currency account.

You’ll get bank details for the US, UK, euro area, Poland, Australia and New Zealand, to receive fee-free payments from these regions. Hold 40+ different currencies, and switch between them using the mid-market exchange rate.

Integrate your Wise business account with Xero online accounting, and make it easier than ever to watch your company grow.

Try Wise Business

open a Wise Business account

Income statement formula.

The single step income statement formula is:
Total Revenues - Total Expenses = Net Income

An income statement compares company revenue against expenses to determine the net income of the business.

Subtract operating expenses from business income to see your net profit or loss. If revenues are higher than total business expenses, you’re making a profit. If your business expenses over the period being examined were higher than your income, the company has made a loss.

This calculation is useful for business owners and investors as it shows the net profitability of a business, and how efficient a company is at generating net income.

Income statements give a snapshot view of business performance - create a monthly, quarterly or annual statement, which you can analyze and compare to performance over the same period in previous years.

income statement formula

Income statement format.

Revenue
Revenue, also called sales or business income, includes money received for the sale of the company’s goods or services.
Expenses
Expenses, commonly referred to as operating expenses, are costs the company incurs related to sales. These might include the cost of goods for resale, property rental, and the price of consumables like printer ink and stamps.
Profit/loss
You can calculate your business profit or loss by subtracting the expenses incurred from your revenue. If the number is positive, you have a net profit. If it’s negative, your business has made a loss in that period.
Keep multiple currencies in one business account
With a Wise Business account you can keep multiple currencies in one account. Save time, cut costs, and connect with more customers all over the world, with Wise.

How to fill in the income statement template?

Choose the time period.
Choose the time period used to generate the income statement - this could be a month, a quarter or a year, for example.
Add revenue and expenses.
Input your business income and expenditure numbers.
Add or remove line items as necessary.
Make sure the income statement fits your business by adding and removing line items as you go. Add a line where needed, or you can also easily delete lines from the template as required.
Double check the formulas.
Confirm that the formulas are working as intended.

FAQ

Both the income statement and balance sheet are important financial statements - but each has a different function for business owners and investors.

A balance sheet gives a point in time view of a company's assets and liabilities, while the income statement details income and expenses over an extended period of time (usually one year). A balance sheet helps determine a company's current financial situation and make important financial decisions. The income statement can be run at any time of the fiscal year to determine profitability and compare one period of time to another to show growth.

Watch your business grow with Wise

Pay international invoices, and receive payments from clients based abroad - making it easy, and cheap, to connect with more customers.

Get your Wise Business account

More free online templates for businesses.