An internal income statement provides an overview of a company’s financial position. It’s usually detailed enough for internal use but not for external stakeholders like banks or suppliers. Follow these five simple steps to prepare an internal income statement monthly, quarterly, or for any other period:
Header Information:
- On the top three lines of a six-column worksheet, enter your company’s name, the type of statement (e.g., Internal Income Statement), and the time period covered.
Income Section:
- Title the first section “Income.”
- List each type of income on a separate line and sum them for “Total Income.”
Expenses Section:
- Title the second section “Expenses” and start it a few lines below “Total Income.”
- List each expense account and its balance.
- Sum the expenses for “Total Expense.”
Calculate Net Income:
- Subtract “Total Expenses” from “Total Income” to determine net income (or loss).
Formatting:
- Use a single line above “Total Income” and “Total Expenses.”
- Use a double line under the net income or net loss amount.
Below is an example of the correct format for an internal income statement:
ABC Company
Internal Income Statement
Jan. 1 – March 21, 20XX
| Income | |
|---|---|
| Sales, widgets | $2,100 |
| Sales, wangles | $3,500 |
| Miscellaneous sales | $4,500 |
| Total Income | $10,100 |
| Expenses | |
|---|---|
| Rent | $1,500 |
| Telephone | $750 |
| Office | $275 |
| Payroll | $5,000 |
| Total Expense | $7,525 |
| Net Income (Loss) | $2,575 |
By following these steps, you can create a comprehensive internal income statement to assess your company’s financial performance.
