Business financial statements are documents that provide information about a business's financial performance, such as income, expenses, and profits. They include a balance sheet, profit and loss statement, and a one-year projection of income. Affiliate financial statements are documents that provide information about an affiliate's financial performance, such as income, expenses, and profits. They include a balance sheet, profit and loss statement, and a one-year projection of income. The main difference between the two is that the business financial statement is for the business itself, while the affiliate financial statement is for the affiliate.
The Profit & Loss sheet is also referred to as an income statement. These statements can also help business owners project future revenues. First, use this equation to determine net profit:
Gross profit – operating expenses = net profit
The gross profit should be calculated as total sales minus the cost of the goods (such as raw materials or inventory). Don’t forget to factor in overhead costs like utilities and insurance.
Keep in mind that you’ll need profit and loss statements for the past three years to show that your business has a strong financial standing.