Net income

In business, net income (total comprehensive income, net earnings, net profit, informally, bottom line) is an entity's income minus cost of goods sold, expenses and taxes for an accounting period.[1] It is computed as the residual of all revenues and gains over all expenses and losses for the period,[2] and has also been defined as the net increase in shareholders' equity that results from a company's operations.[3] In the context of the presentation of financial statements, the IFRS Foundation defines net income as synonymous with profit and loss.[1]

Net income is a distinct accounting concept from profit but the same as net profit. Net income can also be calculated by adding a company's operating income to non-operating income and then subtracting off taxes.[4]

  1. ^ a b "IAS 1 Presentation of Financial Statements" (PDF). IFRS Foundation. 2012. Retrieved April 14, 2012. 
  2. ^ Stickney, et al. (2009) Financial Accounting: An Introduction to Concepts, Methods, and Uses. Cengage Learning.
  3. ^ Needles, et al. (2010) Financial Accounting. Cengage Learning.
  4. ^ "Net Income Formula". New Business Playbook. Archived from the original on 2013-10-19. 

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