Tata McGraw - Hill Education
|Number of Pages
The Income Statement or Profit and Loss Statement of a company, helps in understanding its financial performance over a past period of time and in assessing its financial status, and projecting future earnings. They are needed to analyze performance and define future policies.
How to Read A Profit And Loss Statement defines the importance of the P&L Statement, and explains its various features. It also discusses the principles and methods involved in preparing The Income Statement.
Regulatory requirements need a company to prepare two basic financial statements, the Balance Sheet and the Income Statement. The Income Statement is also referred to as The Profit and Loss Statement. It is the statement of a company's earnings and losses over a specific period of time like a month, quarter or year.
The Profit and Loss Statement is vital in many ways. It helps in understanding the company's financial status and in assessing its actual performance against the projected performance. It also helps compare the company's performance versus the industry benchmark. It is also of vital importance in preparing documents for other purposes. It is needed to calculate income and expenses while submitting tax returns.
How to Read A Profit And Loss Statement explains this document and its features in nine sections, with a tenth section providing solved illustrations. The book provides an Introduction to The Profit and Loss Statement and to Accounting Principles. It shows how income is measured and the steps involved in preparing the P&L Statement.
It discusses Inventory Valuation, and the Income Statement of a Manufacturing Concern. It explains the relationship between the Profit and Loss Statement and the Balance Sheet. It goes into the concepts of Depreciation, Amortization and Depletion. It also looks into determining Possible Future Expenses. The final section provides illustrative problems with solutions to clarify the concepts discussed.
How to Read A Profit And Loss Statement provides a thorough and lucid coverage of the various facets of The Profit and Loss Statement and the steps involved in its preparation. This helps even the non-finance executives to clearly understand the document and use it in the process of decision making.
About The Authors
N. Ramachandran is an academic, consultant and writer.
His other books include How to Read a Balance Sheet, How to Read A Cash Flow Statement, and How to Analyze Financial Statements.
Dr. N. Ramachandran taught at the Asian Institute of Technology and at other institutions, and has over 30 years of academic experience. He has also held consultancy positions in government and non-government organizations in many countries across South East Asia. He is now the Director of Kochi Business School and the Principal Consultant with Management Advisory Services in Kochi.
Ram Kumar Kakani is a professor and writer.
Some of the other books by this author are How to Analyze Financial Statements, Corporate Finance, and Financial Accounting for Management.
Ram Kumar Kakani has rich experience in both, the corporate and academic sectors, and received the AIMS Best Young Teacher Award. He is currently an Associate Professor at XLRI in Jamshedpur