QuickBooks profit and loss statement explained: run the P&L report in QuickBooks Online and Desktop, switch cash or accrual, and fix a P&L that reads wrong.
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Last updated August 2026.
To run a QuickBooks profit and loss statement in QuickBooks Online, select Reports in the left navigation, open the Standard tab and choose Profit and Loss under Business overview. Set the Report period, choose Cash or Accrual under Accounting method, then select Run report. In QuickBooks Desktop the same report sits at Reports > Company & Financial > Profit & Loss Standard.
QuickBooks calls it a Profit and Loss. Your accountant, your lender and your tax preparer call the same document an income statement. They are one report under two names: revenue at the top, cost of goods sold beneath it, then operating expenses, then net income on the bottom line. Nothing in QuickBooks behaves differently depending on which word you use.
Running it takes about fifteen seconds. Trusting it is the hard part. A P&L is only a summary of the transactions underneath it, so an uncategorized charge, a payment posted to the wrong account or a month of bank activity that was never imported all show up as numbers that look perfectly plausible and are wrong. Most of this page is about that second problem: how to read the report, and what to do when it disagrees with your bank.
If whole months are missing because an account was never connected to the bank feed, convert the PDF statement into a Web Connect .qbo file with the tool at the top of this page, import it, and categorize the rows. A profit and loss cannot report on transactions that were never entered.
Built for the statements US banks actually send, checked before it exports.
The converter adds up the transactions it parsed and matches that to the statement total before you export, so nothing is silently dropped.
Valid OFX 1.02 with QuickBooks Web Connect headers. Online and Desktop import it as a standard bank feed.
OCR runs before parsing, so a scanned or photographed paper statement comes out the same as a digital PDF.
Bulk upload for catch-up and cleanup work. Each file gets its own reconciliation check and its own exports.
Enter the password on upload. Multi-column and multi-page statement layouts are parsed too.
One conversion, three files: the .qbo for QuickBooks, an XLSX to review, and a CSV for everything else.
Three steps. No column-mapping wizard.
Drag in a PDF, a scan, or a phone photo. Password-protected and multi-page files are fine.
Every transaction is extracted and checked against the statement total. You see the parsed rows before exporting.
Download the .qbo and import it as a Web Connect bank feed. Excel and CSV are in the same download.
The specifics that decide whether the import is clean. If your case is not here, email [email protected].
Select Reports in the left navigation, then find Profit and Loss on the Standard tab under Business overview, or type it into the report search box. Set the report period, set the accounting method to cash or accrual, and select Run report. The whole sequence is four clicks.
The report opens with your accounts grouped the way your chart of accounts is built. If the grouping looks wrong, the fix is in the chart of accounts rather than in the report: an expense filed under an asset account type will never appear on a profit and loss no matter how you customize it.
In QuickBooks Desktop the path is Reports > Company & Financial > Profit & Loss Standard. Use Customize Report to change the date range, columns and accounting basis, then Memorize to save those settings so the same report reopens with one click later.
Desktop ships several P&L variants in that same menu, and picking the right one saves a lot of customizing. Profit & Loss Standard is the plain report. Profit & Loss Detail lists every transaction inside each account. Profit & Loss YTD Comparison puts the period next to the year to date. Profit & Loss by Job and Profit & Loss by Class break the same figures out by job or class, which is how contractors and multi entity bookkeepers read profitability.
The reporting basis in Desktop is set per report under Customize Report > Display > Report Basis, and separately as a company default under Edit > Preferences > Reports & Graphs > Company Preferences. If your Desktop P&L and your accountant's copy disagree, that preference is the first thing to check.
Yes. Profit and loss statement, P&L, income statement and statement of operations all describe the same financial statement: revenue minus cost of goods sold minus operating expenses equals net income for a period of time. QuickBooks uses the name Profit and Loss, and there is no separate income statement report to look for.
The naming matters only when someone asks you for a specific document. A lender asking for "two years of income statements" wants the QuickBooks Profit and Loss run for each of those years. An accountant asking for "the P&L and the balance sheet" wants Profit and Loss plus Balance Sheet. The one real distinction is timing: a profit and loss covers a span of time, while a balance sheet is a snapshot of one date.
A QuickBooks P&L reads top to bottom in four blocks: income, cost of goods sold, gross profit, then expenses and net income. Each line is an account from your chart of accounts, and the total beside it is the sum of every transaction posted to that account inside the report period.
| Section on the report | What it contains | What it tells you |
|---|---|---|
| Income | Revenue accounts: sales, services, product income, shipping income | What you billed or collected, depending on the accounting method |
| Cost of Goods Sold | Direct costs of what you sold: materials, freight in, subcontracted labor tied to a job | Only costs that scale with sales belong here, not rent or software |
| Gross Profit | Income minus cost of goods sold, calculated by QuickBooks | Your margin before overhead. The number to watch month over month |
| Expenses | Operating overhead: rent, payroll, insurance, software, professional fees | Fixed cost of running the business regardless of sales volume |
| Net Operating Income | Gross profit minus expenses | Profit from the actual business, before anything unusual |
| Other Income and Other Expense | Interest income, gain on sale of an asset, interest expense, one off items | Keeps unusual items out of your operating margin |
| Net Income | The bottom line after everything above | What flows to retained earnings on the balance sheet |
Two lines cause more confusion than the rest combined. Uncategorized Expense and Uncategorized Income are the buckets QuickBooks uses when a downloaded bank transaction was accepted without a category being chosen. Any balance there means real money is sitting in the wrong place, and it is worth clearing before you read anything else on the report.
Run it on the basis you file taxes on, then run it the other way when you want the other answer. Cash basis counts income when the money arrives and expenses when you pay them. Accrual basis counts income when you invoice and expenses when the bill is dated. QuickBooks lets you flip between them on any report without changing your books.
| Cash basis | Accrual basis | |
|---|---|---|
| Income appears | When the customer payment is received | When you create the invoice |
| Expenses appear | When you pay the bill | When the bill is dated |
| Unpaid invoices | Excluded entirely | Included in income |
| Unpaid bills | Excluded entirely | Included in expenses |
| Best for | Seeing what actually moved through the bank | Seeing what a period truly earned and cost |
| Typical user | Smaller service businesses filing cash basis returns | Inventory businesses and anyone required to use accrual |
One behavior surprises nearly everyone: journal entries appear on both cash and accrual basis reports in QuickBooks Online. A manual entry has no invoice or payment attached to it, so QuickBooks has nothing to defer, and the entry lands in both views. That is why a P&L switched to cash basis can still show revenue that was never collected, and it is a good reason to look at QuickBooks journal entries when a cash basis report reads high.
The Statement of Cash Flows behaves differently again. It is built on accrual data by design, because it reconciles accrual net income back to the change in cash, so do not expect the cash basis toggle to make it agree with your bank balance.
Because a profit and loss is not a cash report. Loan principal, owner draws, credit card payments, transfers between accounts and asset purchases all move money without touching the P&L, and unpaid invoices and bills move the P&L without touching cash. A profitable month with an empty bank account is normal, not an error.
Here is the short list of things that leave the bank without ever appearing on a profit and loss:
When you genuinely need the two to reconcile, use the Statement of Cash Flows rather than the P&L. It starts at net income and walks through every one of the items above to arrive at the change in cash.
Almost always one of five things: the date falls outside the report period, the transaction was posted to a balance sheet account instead of an expense account, the accounting method is hiding it, a filter is excluding it, or the transaction was never categorized and is sitting in Uncategorized Expense. Work through them in that order.
| Symptom | Likely cause | Fix |
|---|---|---|
| A known expense is nowhere on the report | Posted to an asset or liability account, not an expense account | Open the transaction and change the category. Check the account type in the chart of accounts |
| Expenses look far too low overall | Report is on cash basis and the bills are unpaid | Switch Accounting method to Accrual and rerun |
| A large Uncategorized Expense line | Bank feed transactions accepted without a category | Click the total to open the detail, then recategorize each row |
| Expenses stop partway through the year | Bank feed disconnected, or statements never imported for those months | Import the missing months, then rerun the report |
| Numbers changed since you last ran it | Someone edited or deleted a prior transaction | Check the audit log, then close the period once it is right |
| Report is blank or nearly blank | A saved customization is filtering to one class, location or customer | Open Customize, clear the filters, and rerun |
The fourth row is the one that quietly costs the most. A bank feed that dropped in March produces a P&L that looks fine, balances to nothing obvious, and understates expenses for half the year. Comparing the P&L month by month is the fastest way to spot it, because a month with real activity and almost no expenses stands out immediately. See bank transactions missing in QuickBooks for the repair.
Click the amount. QuickBooks opens a Transaction Report listing every transaction that makes up that total, with dates, names and amounts, and clicking any row from there opens the original transaction so you can fix it. This drill down works on every figure on the report except the calculated subtotals.
For a version that opens already expanded, run Profit and Loss Detail from the Reports page instead. It prints every account with its underlying transactions listed beneath, which is the report to send an accountant who has asked what is inside a category rather than what the category totals.
Drilling into Uncategorized Expense is usually the highest value five minutes on the whole report. Every row in there is a real payment that has not been told what it was for, and each one you fix moves money into a category that belongs on the return.
Run the Profit and Loss, set the report period to the full year, then set the Display columns by dropdown to Months. QuickBooks rebuilds the report with one column per month and a total column at the right, which is the single most useful view for spotting a month where something went wrong.
The same dropdown gives you columns by week, quarter, customer, vendor, class, location and product or service. Columns by class is how a business tracking departments or properties sees which one is actually making money, and it works only if class tracking is switched on and used consistently. See class tracking in QuickBooks Online.
Read a monthly P&L across rather than down. A rent line that is present eleven times and blank once is a missing bill. A payroll line that doubles in one month is usually a third pay period, not a mistake. Anomalies read instantly in that layout and are nearly invisible on an annual total.
Open Customize on the Profit and Loss, find the comparison options, and tick Previous year. You can add the dollar change and the percentage change as their own columns. QuickBooks Online also ships a Profit and Loss Comparison report that opens with the prior period already alongside.
Add the % of Income column while you are in there. It restates every line as a share of revenue, which is how you tell growth from drift: an expense that grew twenty percent in a year when sales grew forty percent is not a problem, and the raw dollar column will never tell you that.
Select Customize, change the period, columns, filters and header, then save it. In the modern reports experience you use Save as and give the report a name; in the classic view the same action is Save customization. Saved reports appear on the Custom reports tab and can be grouped and shared with other users.
Useful customizations that survive being saved:
A saved custom report can be emailed on a schedule, which is how most firms send clients a monthly package without touching it. Set the schedule from the Custom reports tab rather than from inside the report.
Use the export controls in the report toolbar. QuickBooks Online offers export to Excel and export to PDF from the icons above the report, plus a print option. In QuickBooks Desktop the path is Excel > Create New Worksheet > Export for a spreadsheet, or the Print button for PDF.
Export to Excel when someone downstream needs to rework the numbers, and to PDF when they need a document that cannot drift. A lender or an SBA package almost always wants PDF, because it wants the figures fixed to the date you ran them. A CFO or analyst wants the spreadsheet.
One caution on the Excel export: QuickBooks writes formulas and merged cells into the sheet to reproduce the report layout, so it opens looking like the report rather than like clean data. If you are feeding a model, export the Profit and Loss Detail instead and build your own summary from the transaction rows.
You do not need one. QuickBooks builds the profit and loss from your chart of accounts every time you run it, so the report is the template. What people usually mean by a template is either a saved customization inside QuickBooks or a blank spreadsheet for a business that is not on QuickBooks yet.
If you want a reusable format, save the customization rather than exporting to a blank spreadsheet. A saved P&L keeps its filters, columns and header, refreshes with live data, and never goes stale the way a copied worksheet does. If you genuinely need a static document for a bank, export the saved report to PDF each period.
The one case for a spreadsheet template is a forecast. QuickBooks reports on what happened, so a forward looking budget belongs either in the Budgets feature or in a separate model built from the exported detail.
QuickBooks Online is retiring the classic reporting view and moving everyone to the modern reports experience. Standard reports open in modern by default and the option to switch back to classic is being removed, with saved classic customizations migrating in batches. Intuit has described the timing as phased, so what you see depends on your company file.
Practically, this means two things. The Customize panel looks different from most tutorials written before 2026, and a saved report you rely on every month is worth opening and checking rather than assuming it survived unchanged. The underlying figures do not change; the controls around them do.
If a step described anywhere online does not match your screen, look for the same setting under a different label rather than concluding the feature is gone. Report period, accounting method and Display columns by all still exist in modern view.
Reconcile every bank and credit card account through the end of the reporting period first. A reconciled account is proof that every transaction on the statement is also in QuickBooks, and a P&L built on reconciled accounts is the only version worth handing to anyone. Run the report after reconciling, not before.
The gap is nearly always data that never arrived. Bank feeds reach back a limited window when you first connect, they drop when a bank changes its login, and a closed account cannot be connected at all. Every month that never made it into QuickBooks is simply absent from the profit and loss, with nothing on the report to hint that it is missing.
That is the case for converting the statements directly. Upload the PDF statements for the missing months at the top of this page, get a Web Connect .qbo file with the dates, descriptions and amounts intact, import it in QuickBooks and categorize the For review list. The P&L then covers the full period, the accounts reconcile, and the bottom line means something. It works the same way for a closed account, a credit union that QuickBooks cannot connect to, and a year of catch up work where the feed only reaches back ninety days.
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