Sample Financial Reports

From QuickBooks®

by L. Kenway BComm CPB

Sample financial reports from QuickBooks® are presented here ... because sometimes a picture is better than words ... especially if you are a visual learner.

They also show you how your profit and loss report interacts with the balance sheet.

These basic bookkeeping forms are in the standard accounting format. The first set of financial reports is what you could expect if your were using QuickBooks® EasyStart software.

As EasyStart software is made for small businesses with basic accounting needs, inventory is not an available feature. It is only recommended for businesses with very few  (and I mean very, very few) customers or vendors.

Here is a basic balance sheet for a home based business.

sample balance sheet



Here is a very basic income statement. This business is home based and does not have any inventory so the cost of goods (COGS) is not shown on it.

Side Note: Sorry about the typo in the title of the report ... my bad!!! :0(

sample income statement



I formatted the above bookkeeping example as comparative statements. The current accounting quarter is compared to the previous quarter. If the prior year provides a better comparative for your business, it is very easy to reformat the QuickBooks report.

You'll also notice that I arranged the expenses from the highest to lowest instead of alphabetical order which allows you to focus on the expenses that drive your business. In QuickBooks®, this is easy to do. You do not have to manually rearrange your chart of accounts. Just customize your report to sort by amount.

Sometimes the QuickBooks® comparative reports are referred to as Diagnostic Reports. This is because they can help you see trends.

Take the sample financial report - the Income Statement above as an example. Sales are down 11% this quarter. It could be seasonal which you were expecting ... or you may have a problem surfacing ... finding out now gives you time to react quickly.

The good news in this example is your expenses are under control as you can see they are down 17%. If they had been rising while your sales were falling, you would need to take some corrective action. Expenses have a tendency to creep higher if you don't monitor them carefully.

The other item I formatted in these examples of basic bookkeeping forms is the "% of Column" and "% of Income". Sometimes a percentage amount has more meaning to you than an actual number. It helps you place the numbers in perspective.

Unfortunately, not all of these reporting features are available in QuickBooks Online at the time of this writing. Some of the features are only available in the Accountant's Edition of QuickBooks Online.

You can quickly see in this bookkeeping example that 80% of the assets are cash (I wish this was the case in my business!) and the expenses are only 11% of the current income (I really really wish this was the case in my business!).

In reality, that is a lot of cash sitting in a bank account ... and this company doesn't seem to have large cash demands. This owner could perhaps consider opening a business savings account and earn some passive income on this asset.

So the diagnostic report or comparative report is very useful to help you run your business ... but only if your books are up-to-date and accurate.

If I get enough requests, I will add a second set of sample financial reports that include inventory.



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