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profit and loss

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profit and loss

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profit period measures vital revenue flows period services made transactions goods manage business end results balance trading financial measure loss

A profit and account shows the of a company's over the last financial ( i . e . the period between two sheets ) . Usually this means a year , although the year date can be chosen by the company . December 31 and March 31 are popular , although it could be April 1 or November 5 etc . The profit and loss account shows the effect on the company's account of all the over the past year .
The and loss account the profit or loss on the or sold during the . It does not the cash into and out of the business . This is an essential difference . Cash flow is a part of the management of the and is not dealt with here . To a business both profit and cash must be considered .