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lkoups
Level 3

Profit and loss help

Hi,

I need some help please. I have reconciled my account and it shows I have received about 2,500 in income by subtracting end balance and start balance but when I run a profit and loss report and set it to cash it says I have received £5100 income. I cannot see why this is and thought that setting a cash P&L account would only show what has been paid- am I doing something wrong or should I use a different report?

 

Thanks

1 REPLY 1
RenjolynC
QuickBooks Team

Profit and loss help

Hello, lkoups.

 

I'd like to share some details about the accounting methods in reports. Depending on the method you pick, the figures will not be the same.

 

When you run the Profit and Loss report using the cash basis, it will display the following:

  • Your report counts income or expenses as though they happened when you got the payment or paid the bill
  • A cash basis report only shows income if you have received cash and expenses if you have paid cash.
  • If you sent an invoice or got a bill but the money hasn’t changed hands yet, your report doesn’t include it in your income or expenses

For Accrual basis:

 

  • Your report counts income and expenses as if they happened when you sent the invoice or got the bill
  • The report includes income and expenses even if the money hasn’t changed hands yet.

You can read this article for reference: Choose between cash and accrual accounting methods in reports.

 

Please let me know if you have any additional questions or other concerns. I'm here to answer them. Thanks.