Calculate net income and margins from same-period revenue, COGS, operating expenses, separate depreciation/amortization, interest, other income/expenses and entered income taxes.

Enter revenue, cost of goods sold and operating expenses. Optional amounts default to zero.

Use one reporting period and avoid double counting. Enter operating expenses excluding separately entered depreciation/amortization. USD summary; tax is an entered expense or benefit, not a tax calculation.

Optional settings

Blank means zero. Include only amounts not already counted in COGS or operating expenses.

Signed amount; blank means zero.

Positive expense, negative benefit; blank means zero.

Income Statement Formula

The following 3 equations are used to calculate and generate an income statement.

Gross Profit = Revenue – Cost of Goods Sold
OP = GP − OPEX − D&A
NI = P − Tax

Enter revenue, COGS and operating expenses for the same reporting period. Optional amounts default to zero. Do not count depreciation/amortization again if included in another expense row. Negative other income denotes a loss; negative tax denotes a benefit. In the equations, OP is operating profit, GP is gross profit, OPEX is operating expenses excluding separate D&A, NI is net income, P is pre-tax income and Tax is tax expense (negative for a benefit). Pre-tax income equals operating profit plus other income, minus other expenses and interest. The tool summarizes entered USD amounts in exact cents and does not estimate tax liability. Zero revenue permits a net loss but makes margins unavailable.

Income Statement Definition

An income statement generally includes 3 metrics. Those are gross profit, operating profit, and net profit. They are 3 key metrics for determining the true profitability of any company. The 3 of them together make a more complete picture than any single metric.

Income Statement Example

How to calculate an income statement?

  1. First, determine the gross profit.

    Determine the gross profit from the revenue and cost of goods sold.

  2. Next, determine the operating profit.

    Calculate the operating profit using the sales, COGS, and operating expenses.

  3. Finally, calculate the net profit.

    Calculate the net profit using the revenue and total expenses.

FAQ

What is an income statement?

An income statement is a financial statement that displays the gross profit, operating profit, and net profit of a company.