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: -Typically, net income is synonymous with profit since it represents the final measure of profitability for a company. Net income is also referred to as net profit since it represents the net amount of profit remaining after all expenses and costs are subtracted from revenue.

Detailed explanation-3: -Net income refers to the amount an individual or business makes after deducting costs, allowances and taxes.

Detailed explanation-4: -Examples of Net Income for Businesses The company’s operating expenses came to $12, 500, resulting in operating income of $23, 000. Then ABYZ subtracted $1, 500 in interest expense and added $1, 700 in interest income, yielding a net income before taxes of $23, 200.

Detailed explanation-5: -While net income refers to your income after deductions, gross income refers to your total or pre-tax earnings.