The Profit and Loss Statement in QuickBooks Online

The Profit and Loss statement, also called the income statement, reports whether your business made or lost money over a stretch of time. It starts with income, subtracts the cost of goods sold to arrive at gross profit, then subtracts operating expenses and any other costs, and ends with the net income or net loss for the period. It is the report that answers "did we make money last year," and it is usually the first statement an owner or accountant opens.

What the Profit and Loss shows

For a period you choose, whether a month, a quarter, a fiscal year, or your whole history, the Profit and Loss groups your income and expense accounts and totals each one. Revenue sits at the top, expenses below, and the bottom line is where the two meet. Because it summarizes activity rather than balances, it always covers a span of time instead of a single moment. Every figure on it is built from the posting detail in your General Ledger.

Cash basis vs accrual basis

The Profit and Loss changes with the accounting method. On the accrual basis it counts income when you invoice a customer and expenses when a bill is entered, whether or not the money has moved yet. On the cash basis it counts income when payment arrives and expenses when you actually pay them. The same year can show a different net income on each basis, so an accountant or auditor may want to see a specific one. QuickBooks switches the basis with a toggle and re-runs the report, which is why a complete archive keeps the Profit and Loss in cash and accrual basis rather than only one.

Why a CPA or auditor asks for it

The Profit and Loss is where a tax return's income and deductions begin. A CPA reconciles it against what was filed, a buyer's due-diligence team reads it to judge how the business performs from year to year, and an examiner compares it with the return. Paired with the Balance Sheet, it gives the two-sided picture of a company: what it earned over the period and what it was worth at the close of it. When a line looks wrong, the answer lives in the General Ledger detail behind it.

How to run and export the Profit and Loss in QuickBooks Online

1. Go to the Reports menu and type "Profit and Loss" into the report search box, then open it.
2. Set the report period. For a complete archive, choose All Dates, or run one report per fiscal year.
3. Set the accounting method to Cash or Accrual near the top of the report, and run it.
4. Use the export control at the top of the report to export it to Excel or PDF. The file downloads to your computer.
5. Switch the accounting method to the other basis, run the report again, and export that version too.

For a year broken into columns rather than a single total, the Profit and Loss by Month view shows the same figures month over month. Our guide to exporting all your data from QuickBooks covers how the statements fit with the rest of the records you need.

Keeping the Profit and Loss after you cancel

The Profit and Loss is part of your Books Backup archive, captured in both cash and accrual basis. A cancelled paid QuickBooks Online company stays read-only for 12 months and is then permanently deleted, a trial only 90 days, and the IRS generally expects business records to be kept for at least three years, and longer in some situations. A Profit and Loss you can still open years later is what lets you answer a question about a period long after the subscription is gone.

Frequently asked questions

Is the Profit and Loss the same as an income statement?

Yes. QuickBooks labels it Profit and Loss, and income statement is the same report under its textbook name. Both show revenue minus expenses for a period, ending in net income or net loss.

Which basis should I keep, cash or accrual?

Keep both if you can. Your tax return may be filed on one basis while your internal reporting uses the other, and an accountant or auditor may ask for whichever you did not save. Switching the toggle and exporting a second time takes a moment now and cannot be done at all once the company is deleted.

Does the Profit and Loss show my account balances?

No. It reports income and expense activity over a period. The balances of your assets, liabilities, and equity as of a date live on the Balance Sheet, and the two statements are read together.