If you produce different items / or services it advisable to prepare your income statement so that you can see how much each one makes or losses. While setting this up takes time the returns are well worth the effort

1. It helps to identify if each product or service is making a profit and contributing to the bottom line. Any line that is not making a profit will be reducing your overall profits.

1. You can decide if the profit margin is worthwhile. Setting up your reports in this way also allow you to focus on each product and see how you can improve your profit margins by either reducing costs, improving efficiencies or increasing revenues.

1. You can use this knowledge to decide:

2. If you want to discontinue lines that are making losses and increase your overall profit.

3. Continue with production, concentrating on a loss-making line to turn the losses around.