Profit & Loss Audit Resources

Master your contracting business finances with our comprehensive profit and loss audit guide. Learn how to analyze profitability, identify cost overruns, and make data-driven decisions.

Profit & Loss Audit Tool

Get instant insights into your business financial performance with our easy-to-use profit and loss calculator designed specifically for contractors.

Real-Time Calculations

See your profit or loss calculated instantly as you enter your income and expenses.

Simple & Fast

Quick 3-field assessment to get started with your profit & loss analysis.

Contractor-Focused

Built with contractors in mind - perfect for assessing project profitability.

Free to use • No registration required • Instant results

Why Conduct a P&L Audit?

Identify Profitable Projects: Understand which types of jobs generate the best margins
Control Costs: Spot areas where expenses are eating into your profits
Make Better Bids: Use historical data to price future projects more accurately
Plan for Growth: Identify opportunities to scale profitable operations

How to Use Our Tool

Enter your business name and the time period you are analyzing

Input your total income for the period (all revenue from contracts)

Add your total expenses (materials, labor, overhead, equipment)

View your instant profit/loss calculation and analysis

Key Financial Metrics for Contractors

15-20%

Target Net Profit Margin

Healthy contracting businesses typically maintain 15-20% net profit margins

60-70%

Labor & Materials

Direct costs should typically represent 60-70% of total project value

10-15%

Overhead Expenses

Office, insurance, and administrative costs should stay under 15%

Warning Signs in Your P&L

Red Flags to Watch For:

• Consistently low or negative profit margins
• Material costs exceeding 40% of project value
• Labor costs over 30% without equipment rental
• Overhead expenses creeping above 15%

Take Action When You See:

• Three consecutive months of losses
• Declining profit margins over time
• Cash flow problems despite profitable jobs
• Unexpected cost overruns on multiple projects

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