Claude for small business

March 2026 Month-End Close

P&L Narrative & PayPal / QuickBooks Reconciliation

Period: March 1 – March 31, 2026

Prepared: April 2, 2026

Summary

March revenue came in at $48,210, up 7.5% from February ($44,860). Net income, however, dipped to $11,840 (from $13,210) because annual software renewals hit this month — Adobe CC, QuickBooks, and a few smaller tools accounted for ~$2,040 of one-time spend that won't recur until next March.

Reconciliation between QuickBooks Online and PayPal settlements is complete. 142 of 147 transactions matched cleanly. Five items are flagged below for your review: three are routine timing differences, one is a duplicate refund I've already disputed with PayPal, and one is a $3.18 FX variance I'm comfortable writing off. None should change the bottom line materially.

Q1 2026 closed at $135,250 in revenue and $37,550 in net income — up 14.2% and 20.4% respectively vs. Q1 2025.

Profit & Loss — March 2026

Revenue — $48,210.00

• Consulting services: $32,400.00
• Product sales (digital): $12,650.00
• Affiliate / referral income: $3,160.00

Cost of Goods Sold — $2,096.00

• Payment processing fees (PayPal + Stripe): $1,684.00
• Hosting & delivery infrastructure: $412.00

Gross Profit — $46,114.00 (95.7% margin)

Operating Expenses — $34,274.00

• Software & subscriptions: $16,250.00 (incl. annual renewals)
• Contractor payments (1099): $9,800.00
• Marketing & advertising: $4,120.00
• Professional services (legal): $1,500.00
• Travel & meals: $890.00
• Insurance: $625.00
• Bank & merchant fees: $370.00
• Office & supplies: $284.00
• Miscellaneous: $250.00
• Telephone & internet: $185.00

Net Operating Income — $11,840.00

Margin commentary: Gross margin of 95.7% is consistent with the trailing average. The OpEx ratio (71.1% of revenue) is elevated this month due to renewals; the trailing 3-month average is 64.3%. Excluding the ~$2,040 in one-time annual renewals, normalized net income for March would have been ~$13,880.

PayPal ↔ QuickBooks Reconciliation

• QuickBooks transactions in March: 147 transactions, $48,210.00 total
• PayPal settlements deposited: 144 deposits, $48,182.32 total
• Auto-matched (exact match on amount + date ±1d): 142 transactions, $47,949.14
• Manually matched (after FX/timing review): 0 transactions, $0.00
• Flagged for review: 5 transactions, $261.18 (see below)

Flagged Items (5)

1. Duplicate refund debit — Order #PAY-30142

• Date: 2026-03-08
• Amount: -$129.00 (debited twice)
• Status: Disputed with PayPal 2026-03-12; case #PP-D-7724891 — still open
• Treatment: Recognized as receivable from PayPal in March; will reverse on resolution. No P&L impact.

2. Timing difference — March 31 settlement batch

• QB deposit recorded: 2026-03-31, $1,820.45 (4 transactions)
• PayPal settlement: 2026-04-01, $1,820.45
• Status: Cleared in April PayPal feed; standard month-end cutoff.
• Treatment: Leave revenue in March (earned in March). No adjustment needed.

3. FX variance — UK invoice INV-2026-0287

• Invoice: £1,000.00 booked at 1.2700 = $1,270.00
• Settlement (after PayPal FX + fee): $1,266.82
• Variance: -$3.18
• Treatment: Post to FX Gain/Loss. Immaterial.

4. Unidentified PayPal credit

• Date: 2026-03-19
• Amount: +$84.50
• Description: "PayPal Promotional Credit" — no matching invoice or known promotion
• Status: Emailed PayPal support 2026-03-22; no response yet.
• Treatment: Held in suspense account (Other Current Liabilities) pending response. Not in revenue.

5. Chargeback fee not auto-categorized

• Date: 2026-03-26
• Amount: -$15.00
• Reference: Chargeback on Order #PAY-29871 (resolved in our favor 2026-03-29; $148 returned)
• Treatment: Recategorized as Bank & merchant fees. Original $148 sale stands; only the fee remains.

Notes

• All March bank statements reconciled. Ending balance per QuickBooks ($21,470.18) ties to Chase statement.
• Owner's draw: $5,000 taken on 2026-03-15.
• No federal estimated tax payment was made in March. Q1 estimate of $9,200 scheduled for 2026-04-15 (EFTPS).
• 1099 contractors: total spend $9,800 across 3 contractors; no single contractor exceeds $600 outside what's already on file. No new 1099s triggered.
• Sales tax: collected $1,847 (TX only); remitted via TX Comptroller portal on 2026-03-20.
• Inventory: N/A — services + digital product business.
• No new fixed assets capitalized this month. No depreciation entries needed beyond the standing schedule.

Q1 2026 Trend (for context)

• January 2026: Revenue $42,180.00 / Net Income $12,500.00 (29.6% margin)
• February 2026: Revenue $44,860.00 / Net Income $13,210.00 (29.4% margin)
• March 2026: Revenue $48,210.00 / Net Income $11,840.00 (24.6% margin)
• Q1 2026 total: Revenue $135,250.00 / Net Income $37,550.00 (27.8% margin)
• Q1 2025 total (PY): Revenue $118,400.00 / Net Income $31,200.00 (26.4% margin)
• YoY change: +14.2% revenue / +20.4% net income / +1.4 pts margin