How To Make an Income Statement in Excel in 8 Steps

Creating an income statement in Excel can be a daunting task for those unfamiliar with the program. However, with a few simple steps, you can quickly and efficiently create an income statement that accurately reflects your business’s financial performance. In this blog post, we will provide you with detailed instructions on how to make an income statement in Excel. We will explain the individual components of the statement, how to enter them into the program, and how to format the statement for visual appeal. Additionally, we will provide tips and best practices to ensure that your income statement is accurate and up-to-date. By following the instructions in this post, you will be able to create a comprehensive and reliable income statement that will serve as an effective tool for analyzing your business’s financial performance.

Excel Tutorial: How to Create an Income Statement

When is it important to create an income statement in Excel?

If you’re looking for a way to create financial records in a program that you might already be familiar with using, it’s important to create an income statement in Excel. It might be especially appealing to small business owners who evaluate their revenue and expenses using cash-based accounting systems. You can easily enter the transactions from your cash-based accounting system into Excel to track your finances easily.

What is an income statement?

Organizations use income statements as financial records to keep track of their earnings and outlays over a specific time period. It works well for keeping track of income and expenses by category to reflect an organization’s overall financial health. By grouping the data, it may be possible to highlight the organization’s strengths and potential improvement areas, offering guidance on how to streamline operations and boost revenue.

How to make an income statement in Excel

Follow these steps to make an income statement in Excel:

1. Prepare your Excel file

Create a new Excel document and set it up as an income statement. Type the company name and “income statement” in cell A1, for example, “Island Oasis Pool Company Income Statement.” Think about using formatting tools to make the name stand out from the rest of the content. For instance, you could bold, italicize, or enlarge the text by highlighting it. To ensure that the company name fits, adjust the column’s width as necessary.

Press “Enter,” then after leaving a row of cells empty, press it once more. Enter “covered period” in cell A3 and then the year or range that the income statement pertains to, for example, “Covered period: December 2021.” Use formatting tools as needed to enhance the text’s appearance and make it consistent with how you stylized the sheet’s name, such as by making the “Covered period:” bold. Make sure to modify the column’s width if necessary.

2. Determine the categories

Choose the categories you want to display on your income statement. Depending on your organization and how specific you want the sections to be, you can add however many categories you like. You might, for instance, only include a single section for all sources of income and a single section for all sources of expenses. Alternatively, you could categorize your income and expenses into the following groups:

3. Choose the subcategories

To identify the subcategories, review your financial data and the categories you’ve chosen. The line items for the totals you report on the income statement are the subcategories. The following are a few examples of subcategories under the gains and losses from continuing operations category:

Here are some examples of possible nonrecurring event subcategories:

Examples of subcategories for the operating expenses category include:

Some examples of subcategories for a revenue section may include:

4. Input the categories and subcategories

Press “Enter” twice to move to cell A5. In cell A5, enter the name of your first category and change the formatting to make it stand out from other text. For example, you may change it into bold font.

Press “Enter,” then begin typing the names of the subcategories. There are two ways to enter the subcategories, and both are reasonable choices. Following are the choices you can make based on your individual preferences and organizational requirements:

Aim to group similar subcategories together. Once a category is complete, press “Enter,” and then add a subcategory to increase the category’s overall total. To add the following category, press “Enter” two more times, leaving a row empty in between. Continue until you’ve added every section you want to have.

5. Set up the formulas

On your income statement, highlight those cells and use the appropriate formulas. Select the cells for your subcategories for total revenue, for instance, and use the SUM formula on them. To ensure that the result appears where it should, make sure to stop above the total row.

6. Input the data

Refer to your other accounting and financial statements. Fill in the necessary information in the income statement’s corresponding cells. Watch the outcomes in real-time for any potential formatting or formula errors.

7. Consider additional formatting

Consider adding more formatting to your Excel income statement to make it more aesthetically pleasing or understandable. For instance, think about emphasizing crucial rows or completely filling each category’s rows. Another choice might be to use red font to highlight any negative numbers.

8. Finalize the document

Look over your income statement for any potential mistakes or missing data. Fix any problems you find, and make sure the formatting is consistent all throughout the document. Create a file name for the document after saving it that precisely describes what it is.

Please note that Indeed is not affiliated with any of the businesses mentioned in this article.


What is the formula for income statement in Excel?

Similar to how net sales are calculated, the formula for total operating expenses Use =SUM( then select all cells under this subcategory. Utilize the equation =[Gross Profit (Loss)]-[Total Operating Expenses] to determine your operating income (loss).

Can you make an income statement in Excel?

Open Microsoft Excel. Enter the name of the company for which you are preparing the income statement by clicking into the top cell (A1) and typing “ABC Wood Creations.” To make sure your income statement title fits, double-click the line separating columns A and B.

How do I create an income statement chart in Excel?

How to Illustrate Financial Statements in Excel 2016
  1. Click on any cell within your summarized income statement.
  2. Select the Insert menu in Excel 2016.
  3. Select Recommended Charts.
  4. Within the Insert Chart dialog box, select the All Charts tab.
  5. Select Waterfall.
  6. Click OK.
  7. A waterfall chart will appear within your worksheet.

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