accountant wynnum

sometimes that’s called turnover expenses are generally referred to as overheads that was a quick slide it’s a profit and loss statement so sales we have a profit loss statement are the the sales of the company or business minus the cost of sales now the cost of sales is a direct expense that relates to selling or creating a sale so let’s say that you’re selling a product on eBay and you pay 50 pound for a product and sell it for 100 pound the cost of sale will be that 50 pound plus any fees you have to pay to sell the product on eBay its expenses that relate directly to provide in the sale or making the sale another example would be if you provide a service or somebody and you pay an agency a commission for each job they refer to you that would be the cost of sale plus any materials you use to provide that service sometimes this can confuse people but it’s just expenses that have a direct link to providing a sale so you have your sales minus your cost of sales and that will give a gross profit or gross loss for a company you then have minus expenses or minus overhead so this is things like rent rates electric wages

These things don’t really have a direct link to provide an a sale your internet bill your phone bill these things you can’t directly link to providing the sale these are your overheads once they’ve been taken from the gross profits you have a net profit figure and that’s the the profit or loss figure for the company let’s see if I have a template that I can share with you okay so here’s a profit and loss statement on the left here or ignore this on the right so we have turnover cost of goods so it costs me or cost this company two thousand two hundred pounds to make this many sales that’s our gross profit and then had been expenses so this is just a group total of things like wages rent electric and then we have profits for the period which is the net profit

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