A profit and loss statement (P&L) provides a snapshot of the business’s financial performance over a specified period. It helps you:
1. Measure Profitability: Understand whether your business is profitable or operating at a loss. 2. Track Revenue and Expenses: Identify trends and make informed financial decisions. 3. Plan for Taxes: Estimate your tax obligations based on your profits. 4. Attract Investors: Demonstrate financial health to potential investors or lenders.