Fixed Expenses. Add up lines 4a through 4n and fill in the total for each month.     6.Profit/(Loss). From the Gross Profit (line 3), subtract the Total Fixed Expenses (line 5) and fill in the result. Make sure that you place brackets around each negative number-that will identify it as a loss.     Year Total. Finally, add up each of the rows (lines 1 through 6). Enter the yearly totals under the Year Total column. Check your arithmetic by seeing if the monthly profit figures add up to the same figure you get for your yearly total. If they dont match, double-check your addition to find the error. If they match, congratulations!   E. Review Your Profit and Loss Forecast     Youve now completed your first run through a Profit and Loss Forecast. Date it so you wont get confused if you do another draft. I hope it looks positive. However, if like many people you find you need to increase profitability to make the business a good economic idea, go back through all your assumptions. How can you realistically reduce costs or increase volume? Incorporate into your forecast only those changes youre sure are sound. Now look at the profit figures again. Do they show enough profit to make a good living, pay back your money source and leave some margin for error? If they do, and youre sure the figures are right, you will want to go ahead with your business idea. If the adjusted figures still do not show enough profit, it may be wise to look for another business idea or change your basic business assumptions.     Notice that Antoinettes business looks more profitable in her Profit and Loss Forecast than it did in her preliminary analyses Thats because she increased her first years sales estimate from $400,000 to $450,000 and reduced her fixed costs from $16,050 to $12,050 per month. The net effect of these changes was a slight increase in profit. She knows these numbers will be hard to achieve, but she is confident that she can make her goals.     How much profitability is enough to justify going ahead with your business? Thats both a good question and a touchy one. Or, put another way, there are almost as many answers as there are businesspeople. My personal response is, I look for a yearly profit (including my wages and return on investment) equal to the amount of cash needed to start the business. If I need $40,000 to start a business, a conservative profit forecast would show a yearly profit of at least $40,000.     One way to approach the issue of profitability is to look at your profit forecast from an investors viewpoint. A $35,400 profit for the dress shop wont seem like much to them. They will be concerned that the dress shop owner will have a difficult time earning a living and making it through the inevitable slow times. An investor or lender will probably want her to be able to convincingly demonstrate she has a plan to increase sales enough to raise the profit forecast to a more respectable level-say, the $46,200 she shows in the second year.