Glossary · Reading the business
In short
This financial document summarizes a company's revenues, expenses, and profits or losses over a period, like a quarter or year. It's essential for understanding a business's historical profitability.
When evaluating a business, you'll analyze its Income Statements (also called Profit and Loss Statements) for the past three to five years. Look for consistent revenue, manageable expenses, and stable profit margins. This helps you project future cash flow and determine the business's true earning power, especially after considering add-backs for owner compensation.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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