Question

how does your knowledge on profit and loss help in avoiding loss in any business transaction and ensure profit ​

Answer 1

Answer:

Managing P&L means you work toward having greater revenues and fewer expenses. You use your current profit and loss statement to determine your business's profitability. Looking at your P&L statement can also show you where you need to make changes in your business.

The profit & loss account provides information about an enterprise's income and expenses, which result in net profit or net loss. It helps a businessman evaluate the performance of an enterprise and provides a basis for forecasting future performance