Creative work is project-based, paid in stages, and delivered long after the costs are incurred. The books should reflect that shape.
Revenue
Project revenue — the main line. Retainer revenue where clients are ongoing. Licensing and usage revenue where work is relicensed later. Print and product revenue where physical goods are sold.
Licensing deserves its own line even when small. It is the closest thing to recurring income in this trade and it is invisible if folded into project revenue.
Deposits are a liability
A deposit taken at booking is not revenue until the work is done — see deferred revenue.
This matters more here than in most trades because deposits are large and the gap to delivery is long. A studio that books deposits as income has a profitable-looking month and an obligation it has already spent.
Cost of delivery
Contractor and freelancer costs, equipment hire for a shoot, location and permit fees, travel on a project, and print or production costs.
These are job costs and belong against the project that incurred them, which is what makes job pricing improvable rather than guesswork.
Working capital is the constraint
Costs land at the start, payment lands at the end, and the gap is funded by the business — see working capital.
That is why staged payments matter so much in this trade: a deposit, a progress payment, and a balance on delivery, rather than everything at the end.
Overhead
Creative software subscriptions, equipment depreciation, studio or premises, insurance, marketing and portfolio costs.
What this setup gives you
The deferred balance, project margin, and a clear view of how much of the business is funded by client money rather than its own.