P&L Profit before tax seems to be calculated wrong

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1

Hi,

On the P&L sheet, the profit before tax seems to be made up of TURNOVER minus COST OF SALES plus EXPENSES, instead of minus expenses.

eg Turnover £100k
cost of sales £60k
expenses £10k
profit showing as £50k

The text is correct (LESS cost of sales Less expenses) but the formula seems to be wrong. It makes the profit more than the difference between turnover and cost of sales.

Can anyone confirm this please?
Thanks

2

Hi @Pelican10

The first thing to do here is to find out if there’s anything unusual on your expenses (e.g. a positive balance), as this could throw the figure out.

These would be in green text rather than red on the report. You can drill down into that nominal code further to see what may be contributing to the figure.

3

Thanks Mathew,

That does seem to be the problem. There is a positive value in 9998 (suspense account), which it says comes from a positive opening balance in my company savings account. Surely that shouldn’t be listed in the P&L?

4

The double entry for opening balances goes into the suspense account because QuickFile doesn’t know where else to put it (i.e. where the money actually came from). You need to add your own journal to move the balance to the appropriate place(s), which could be as simple as “capital introduced” but talk to your accountant if you’re not sure.

5

Perfect, many thanks Ian. As I’m looking at these reports I’m discovering all sorts of things in the wrong place. Such as my Director’s salary going in “net wages” until I did something back-stage! It’s all learning though, eh?

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