An income statement, also known as a profit and loss (P&L) statement, summarizes a company's revenues, costs, and expenses over a specific period, typically a month, quarter, or year. For a retail store, it shows how profitable the business is by detailing sales, the cost of goods sold, and operating expenses.
Retail Store Income Statement
For the Period Ended December 31, 2024
Revenue
- Gross Sales: $500,000
- Less: Sales Returns and Allowances: ($10,000)
- Net Sales: $490,000
Cost of Goods Sold (COGS)
- Beginning Inventory: $80,000
- Purchases: $250,000
- Freight-in: $5,000
- Cost of Goods Available for Sale: $335,000
- Less: Ending Inventory: ($95,000)
- Cost of Goods Sold: $240,000
Gross Profit
- Net Sales - Cost of Goods Sold: $490,000 - $240,000 = $250,000
Operating Expenses
- Selling Expenses:
- Salaries and Wages (Sales Staff): $60,000
- Advertising and Marketing: $20,000
- Rent (Storefront): $15,000
- Utilities: $5,000
- Depreciation (Store Equipment): $3,000
- Total Selling Expenses: $103,000
- General and Administrative Expenses:
- Salaries and Wages (Admin Staff): $30,000
- Office Supplies: $2,000
- Insurance: $4,000
- Professional Fees (Accounting/Legal): $3,000
- Miscellaneous Expenses: $1,000
- Total General and Administrative Expenses: $40,000
- Total Operating Expenses: $143,000
Operating Income (EBIT)
- Gross Profit - Total Operating Expenses: $250,000 - $143,000 = $107,000
Other Income and Expenses
- Interest Income: $500
- Interest Expense: ($2,000)
- Net Other Income/Expenses: ($1,500)
Net Income Before Taxes
- Operating Income + Net Other Income/Expenses: $107,000 - $1,500 = $105,500
Income Tax Expense
- Income Tax Expense: ($25,000)
Net Income
- Net Income Before Taxes - Income Tax Expense: $105,500 - $25,000 = $80,500