Your Chart of Accounts Profit and Loss Statement
,You’ve now built your chart of accounts for the P&L statement. Here’s what this part of the chart of accounts looks like:
Income
Cost of Sales
Expenses
Add this to your balance sheet portion of the chart of accounts and you are ready to go. Now we’ll look at how this becomes the general ledger and how you work with both the chart of accounts and the ledger.
The Least You Need to Know
• Income minus cost of sales is equal to gross profit.
• Expenses are subtracted from gross profit to calculate net profit.
• The expenses section of the chart of accounts can be lengthy. How detailed you want to make this section is dependent on what type of expenses you need to track and how detailed your records need to be.
..................Content has been hidden....................
You can't read the all page of ebook, please click here login for view all page.