How to Read Financial Statements
Most small business owners do not need more accounting jargon. They need to know whether revenue is becoming profit, whether profit is becoming cash, and what needs attention next.
Revenue
How much money the business generated before costs.
Gross profit
What remains after product costs. It shows product-level margin.
Net profit
What remains after operating expenses. It shows whether the business is truly profitable.
Cash balance
Money available to operate now. Cash can fall even when sales grow.
Operating expenses
Ads, software, logistics, labor, and other running costs.