ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What is gross profit? Gross profit is the profit a business makes after subtracting all the costs that are related to manufacturing and selling its products or services. You can calculate gross profit by deducting the cost of goods sold (COGS) from your total sales.

Detailed explanation-2: -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-3: -Gross pay is what employees earn before taxes, benefits and other payroll deductions are withheld from their wages. The amount remaining after all withholdings are accounted for is net pay or take-home pay.

Detailed explanation-4: -Mandatory deductions: Federal and state income tax, FICA taxes, and wage garnishments. Post-tax deductions: Garnishments, Roth IRA retirement plans and charitable donations. Voluntary deductions: Life insurance, job-related expenses and retirement plans.

Detailed explanation-5: -Gross income includes your wages, dividends, capital gains, business income, retirement distributions as well as other income. Adjustments to Income include such items as Educator expenses, Student loan interest, Alimony payments or contributions to a retirement account.