In order to ensure the health and success of your business, it is essential to monitor key financial metrics and maintain a steady flow of resources and income. This requires a thorough understanding of your organization's financial performance, including revenue generation, expenses, and overall profitability.

To gain a comprehensive overview of these crucial aspects, utilizing an Income Statement Template is highly recommended. By doing so, you can effectively track and manage your finances, safeguarding your assets and ensuring long-term stability for your business.

An income statement is a document that sets out your company income versus total expenses to help calculate the overall profit in a specific period.

Sometimes income statements are known as statements of operations or profit and loss statements.

Basically, you use an income statement to compare processes throughout the year, a quarter of a year, or a month, and check the cash flow in that period by comparing income and expenses.

Accessibility

People from your accounting departments can enter the document and check tax and expense information for later analysis. Besides, working in an Excel template also allows specialists to easily customize the document and calculate the company's profitability.

Flexibility

A document of this nature will provide you with better management of your company's resources since you can know your general expenses and gains. A good income statement template will give you more control over projections, additional resources, and other line items that influence your profit.

Easy-to-Use

Most income statement creations are counterproductive due to the complexity of their format or the need for more information. An income statement template will let you remove any unsubstantial information to calculate costs better, interest expenses, and other factors.

Compatibility

The income statement template we share below is compatible with any industry and company, assuring the success of accounting operations. A document of this nature is essential to save time and resources, and it can be used in most versions of the Microsoft Office suite.

Luckily for you, here on RoyalCDKeys, you can acquire a reliable copy of Microsoft Office 2021 Professional Plus Key Retail Global at the lowest price on the market.

In general terms, there are three types of income statements. They’re organized depending on the information they have and how they distribute data.

Basic Income Statement Template

In general, basic income statements are more than enough for most small businesses that must create an internal report of operations and profit. Generally, this introductory income statement considers income, expenses, net profit, or loss.

Traditional Income Statement Template

This is also known as a single-step income statement. It puts all the revenues together in one list. Then, it expresses the total operating expenses and, finally, the loss. This traditional income statement is significant in defining the financial status of small and middle-size companies. If you're a small business owner, this template will suit you well. Yet, if you have a large company, you'll need a more complex income statement.

Multiple-Step Income Statement Template

The multiple-step income statement is a more complex document than the above, providing a deeper level of detail and overview of the company’s financial health. In this, operating and non-operating activities are listed in independent sections. This template also has individual sections for operating income, gross profit, non-operating system, net income balancing figures, and more.

This section teaches you how to create your income statement template in Microsoft Excel. This section will be very helpful for your company since you can fill it quickly in subsequent projects or periods.

Open a New Sheet

Creating a new income statement template in Excel starts by opening a new sheet. You can also use one of the templates we share below, but you will still need to know how to organize revenue, expenses, etc.

Create a Header

First, you must select all the boxes you want to use as a header. After selecting, merge all the boxes to create a big box. Then, insert the name of your company. Of course, you can add another big cell for the document's title and period.

Revenue

The first section you need to create is the Revenue section. Create a specialized column with all your company's revenue, i.e., the total sales, such as product sales, services sales, website sales, and more. Then include a row for gross revenue, the sum of all sales.

You should also include a row for net revenue, the gross revenue minus sales returns.

Gross Profit

Now you need to create a gross profit with the values in the image below to calculate the COGS. Then, subtract this value from the net revenue. COGs are equal to inventory minus discounts and returns.

Operating Expenses

You should also include a special section for operating expenses. Although this balance sheet may consist of many items, you should include the following values:

Moreover, include a tax row immediately after the total operating income. The taxes will depend on the country you live in or the region where your organization operates. Finally, calculate the net profit by subtracting the taxes from the total operating income.

In this section, you will find four income statement templates you can use to calculate COGs, profit, and taxes to pay. Besides, these templates will help you to forecast the resources you will get in the next period.

Free Income Statement Template

This traditional income statement template separates revenue and expenses into two categories. It's perfect for defining a small business's financial statement since it includes advertising expenses, commissions, insurance, rent, salaries, research and development, utilities, employee benefits, etcetera. Finally, this income statement shows the final profit by subtracting expenses from revenue.

You can download this free income statement template from Vertex42.

Monthly Income Statement Template

This template is also a single-step income statement and a Microsoft Excel worksheet. Just like the previous example, this document separates the business expenses from sales and gross revenue. It allows you to track and check revenue for the entire year by dividing the document into months to show a profit for the period clearly. To get all the financial data, you must enter the number of customers and the average sales to determine the monthly sales. This is a great document to check the overall financial performance quickly.

You can download this monthly income statement template from Smartsheet.

Multi-Step Income Statement Template

This important financial statement is crucial to establish your company's financial position. It clearly differentiates total revenue from the cost of goods sold and operating expenses to have an overview of the financial information on a specific period. This template is typically used for medium size and large companies that need to analyze earnings and finances quickly. This template also lets your company's investors know if their investments are in good hands.

You can download this multi-step income statement from Wise. 

Simple Income Statement Template

This is a simple Microsoft Excel template for quickly getting a summarized invoice or a document that breaks down expenses and income and calculates the profit. This document lets you quickly exchange information and add and subtract columns and rows to remove line items or whatever you want. Furthermore, this document has a great style and look, so it's perfect for providing your organization with a professional paper.

You can download this simple income statement template from Zervant.

No matter if you have a small, middle size or large company, the selling process involves significant control over costs, revenue, and expenses. Thanks to the steps we shared with you, the document you've created will help you in all those mentioned above, providing your organization with a powerful tool for analyzing the financial health of your business.

Finally, if you're looking for other relevant templates and tools for your organization, at RoyalCDKeys, we're constantly sharing essential documents and tools for your company. Do not miss anything! Subscribe to our newsletter to receive RoyalCDKeys news directly in your email! And be aware of all new games and copies by registering. We're waiting for you!