ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What is Net Income? Net income is the amount of accounting profit a company has left over after paying off all its expenses. Net income is found by taking sales revenue and subtracting COGS, SG&A, depreciation, and amortization, interest expense, taxes and any other expenses.

Detailed explanation-2: -To calculate net income, take the gross income-the total amount of money earned-then subtract expenses, such as taxes and interest payments.

Detailed explanation-3: -Take Home or Net Salary = Direct Benefits-Deductions In this case, tax is based on the employee’s gross salary and the employer is required to deduct TDS from an employee’s salary. However, the basic salary of an employee should be at least 50-60% of their gross salary.

Detailed explanation-4: -Net Income = Total Revenues – Total Expenses Net Income or Net profit is calculated so that investors can measure the amount by which the total revenue exceeds the company’s total expenses.

Detailed explanation-5: -Net income is gross profit minus all other expenses and costs as well as any other income and revenue sources that are not included in gross income. Some of the costs subtracted from gross to arrive at net income include interest on debt, taxes, and operating expenses or overhead costs.