An income statement of a company is crucial for understanding the financial condition of the company. It helps one in drawing a conclusion that whether a company is making a profit or loss. In finance terminology, it is a kind of financial statement in which the revenue collected by a firm are mentioned along with the expenses made by the company for those particular goods from which revenue is collected. Revenue is the amount of money collected from the sale of goods without in which the investment and production charges are not excluded. It is also known as profit and loss statement.

Since projected income statement is made for a particular period of time thus it is customary that one should prepare it carefully. This is quite important in determining the future of a business and also affects the business operations to a great extent. First of all calculate the industry percentage by which you get an estimate your contribution to the industry for which you are manufacturing products. Secondly, estimate total revenue that you would be able to collect by selling your products. Once you have counted on your profits, then you should calculate the money you have spent in the production of goods. Do not leave any cost that you have spent. After all these steps have been performed calculate your gross profit or loss.

It is easy for small scale industries to prepare their projected income statement manually. But for most of the people the job is cumbersome. To make it more accurate, its XLS templates have been created by lot of companies. Different templates have been designed for small companies and large scale companies. There are generally to two types of income statement namely single-step and multi-step. The former type is the one in which revenues and expenses columns are combined into one. On the other hand, multi step is used for calculating gross profit and income which is operative.

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