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By combining these elements, the income statement illustrates just how much your company makes or loses during the year by subtracting cost of goods and expenses from revenue to arrive at a net result -- which is either a profit or a loss.
For a business plan, the income statement should be generated on a monthly basis during the first year, quarterly for the second, and annually for each year thereafter. It is formed by listing your financial projections in the following manner:
1. Income -- Includes all the income generated by the business and its sources.
2. Cost of goods -- Includes all the costs related to the sale of products in inventory...
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