Lesson Plan

• Describe the components of a statement of profit or loss (revenue, cost of sales, gross profit, expenses, profit).
• Calculate revenue, cost of sales, gross profit and operating profit using the standard formulas.
• Explain how each component influences overall business profitability.
• Analyse a sample statement to spot errors or omissions.
• Prepare a simple profit and loss statement for a hypothetical company.

• Projector or interactive whiteboard
• Printed worksheet with sample data
• Calculator for each student
• Whiteboard markers
• Example profit‑and‑loss statement handout
• Sticky notes for exit tickets

Begin with a quick question: “If a business sells 100 shirts at $20 each, what does that tell us about its performance?” This activates prior knowledge of revenue. Briefly recap the previous lesson on basic accounting concepts and outline today’s success criteria: students will identify each line item in a profit‑and‑loss statement and perform the related calculations.

1. Do‑now (5’) – Students calculate revenue from given units and price; teacher checks answers.
2. Mini‑lecture (10’) – Explain the purpose of a profit‑and‑loss statement and introduce each component with formulas using projected slides.
3. Guided practice (12’) – Work through a sample statement together, filling in missing figures for cost of sales and gross profit.
4. Independent activity (15’) – Students complete a worksheet to calculate operating profit and profit before tax for a new scenario.
5. Peer review (8’) – Pairs exchange worksheets, verify calculations, and discuss discrepancies.
6. Quick check (5’) – Teacher asks concept questions (e.g., difference between gross profit and operating profit) and records responses.
7. Exit ticket (5’) – Students write one key takeaway and one question on a sticky note.

Summarise how each line item flows from revenue to final profit and why accurate reporting matters for business decisions. Collect exit tickets to gauge understanding and assign homework: create a profit‑and‑loss statement for a small online store using the provided data.