How to Use the Simple Income Statement Builder
An income statement is revenue with costs subtracted in a fixed order until you reach the bottom line. This builder walks revenue โ cost of goods sold โ gross profit โ SG&A โ operating income โ non-operating items โ pre-tax income โ income tax โ net income, showing each line both in dollars and as a percentage of revenue.
The steps matter because they localize where the profit went. A falling gross margin points at product cost or pricing; a stable gross margin with shrinking operating income points at payroll, rent and other SG&A. Interest expense sits below operating income as a non-operating item, which is why a loan does not change your operating margin.
Income tax here is a simple effective rate applied to pre-tax income. Real liability depends on the federal rate, state and local taxes, your entity type, and credits and adjustments โ a pass-through entity pays no entity-level federal income tax at all. Check current IRS guidance or your CPA before relying on the figure. When pre-tax income is zero or negative, tax is set to $0 and the note says so.
Frequently Asked Questions
Operating income is what the core business earned. Net income adds non-operating items such as interest income and interest expense, then subtracts income tax.
There is no single right rate: it depends on your entity type, state, credits and adjustments. Dividing last year's tax expense by last year's pre-tax income gives a workable estimate, or ask your CPA.
Yes. Switch the dropdown to monthly and every line is treated as a monthly amount; net income is then also shown multiplied by 12 as an annualized figure.