Sample Income Statement Template

Here's a sample income statement template showing the typical income statement format and line items. It looks a bit confusing at first, because I've shown the concise version of what a typical public company might show in their consolidated statement (in pale yellow and bold), and also the more detailed breakdown of those items - more likely what you would use in a small business. A large business would use these lines too, but they would not publish them.

Income Statement Format

The top half of the income statement shows directly variable values. Values that rise and fall with the activity of your business. First there is the sales figure. This is also called Turnover or Revenue. You might see any of these names. Revenue is the dollar value of goods sold to your customers in a given time period. For a public company this is usually a year.

Underneath that is an item called cost of sales which shows all the costs directly attributable to the products which ended up in your customers arms. The small business column, shows how this might be made up for a typical small retailer. If you manufacture things, you'll need raw material and direct labour in there too.

At this point the income statement will cast it's first profit number. This is gross profit, and where directly variable elements of the income statement come to an end

Below gross profit, we have something called goodwill amortization. Goodwill is the excess of business value, over and above the fair value of it's assets. It usually occurs when a business acquires another business. So by the time you have this in your accounts, you're no longer a fledgling business.

The next section of the statement relates to all costs that do not go up and down with the activity of your business. The fixed costs or overheads.

After Overheads, operating profit before tax and financing charges is calculated. In the main this is because the management of a business cannot directly influence the taxation environment in terms of rates and reliefs.

Next up on the sample income statement is the financing costs, then the tax before we come to the net profit for the year

In a public company with shares, you'd normally expect to see a computation of shareholder earnings. Shown here for completeness.

If you would like to use this income statement, and change it to fit your business then please click on this income statement link

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