Next we're going to analyze our financial statements and operating expenses to see if they accurately reflect all of the financial transactions we just inputted. If you're using your own accounting software to update your company's income statement that works too.

The nice thing about our handy Income Statement is that once we plug in all the values, the story from there is essentially told. All of our columns add up and ultimately tell us the honest truth – “did we make any money?”

Did We Make Any Money?

How we use this information is key. The Analysis step here is about getting all the troops rallied (assuming we have troops to rally) and ask:

“What did we just learn, and what changes do we need to make?”

Unlike a Profit and Loss Statement, ou...