Financial Flow Calculator & Worksheet
This is a special flow calculator and worksheet that helps show the connection between the income statement (also known as a P&L or profit and loss statement) and the balance sheet. Both income statement (P&L) and balance sheet are considered financial documents and are used in business to help determine the status and profitability of business actions. Think of these two reports as the "Grouped Totals" for what is going on from day to day.
The whole purpose and goal of this little mini application and calculator is for teaching, training, and establishing financial flow. We want you to play around and see what happens as you make changes. Nothing is recorded in the database and may be tweaked to meet your needs. Think quick or temporary when using this worksheet. We highly recommend that you start basic and try to get concepts down before you start getting really technical. All math on this page is done automatically and will show up on both top and bottom of the form (quick financial totals).
Having said that all math is automatic, the calculator will only calculate what you give it. The system is set up to watch for changes. This means that you need to enter a number and then leave that field by using the tab key or clicking your mouse to a new field. Once that field is no longer selected (you went to the next field), the numeric value will be figured in to the page. The auto calculated fields (math values) will have a light blue background. These fields are controlled behind the scenes and are only editable as you interact with the main worksheet values.
Inside the actual flow or worksheet section there are options for captions and descriptions (first bigger text field) and numeric values (second smaller text field). The captions are not required but are there to help you know what numbers are what. This is where you tell the story of what is going on. Each mini section will do the math on its own section and then pass that value on to the next part of the page. The entire page is tied together and will hopefully help show the link between the profit and loss statement and the balance sheet.
Both the income statement (P&L or profit and loss statement) and the balance sheet usually end up being quite in-depth in real life and may contain multiple layers in order to tell the real story of what is going on or what has been done. This page is purposely set up to help make things as simple as possible. The actual [email protected] P&L and balance sheet get dynamic data and values passed to them and will help you automate a number of the standard practices and/or procedures. For more information about how [email protected] runs your P&L or balance sheet, click the help file links provided.
The P&L is a time based report of buying and selling and basic operating expenses. By time based we mean that there is a date range associated with it. It could be a day, a week, a month, a quarter, a fiscal year, etc.
The balance sheet is a "Snap Shot" in time and only applies to a single day. Basically, it is a roll call of who was where and what happened at that exact time (according to the system). The connection between the two is what is called the "Net Profit" or "Bottom Line". This value is first figured on the P&L and then passed to the equity portion of the balance sheet (see worksheet). The ending date range on the P&L is the balance sheet look-back date or balance sheet date.
One of the hardest things for people to figure out is what goes on the income statement and what goes one the balance sheet. There are chapters and chapters that cover the in and outs of both reports. For basic purposes, the P&L is the day to day buying and selling of items and services. It also includes basic expenses that are required to run your business. The balance sheet deals more with who owes who, and how things get classified or grouped. Do we own it (or trying to own it), these are the assets. Do we owe for it (or trying to pay for it), these are the liabilities. The last piece of the puzzle is the equity or distribution of wealth (who are the players and what is their piece of the pie).
If more fields or rows are needed for math calculations, use the form at the top of the page to increase the row count. All existing values will be passed to the next page and shown in the new report. This allows you to increment the number of rows as needed. Once again, all math is automatically done as changes are made.