A profit and loss statement, often referred to as a P&L statement, is a financial report that summarizes a company's revenues, costs, and expenses over a specific period. It helps businesses understand their financial performance by showing whether they made a profit or incurred a loss during that time. The statement typically includes key components such as total revenue, cost of goods sold, and operating expenses. By analyzing these figures, business owners and stakeholders can make informed decisions about budgeting, investments, and overall financial strategy.