Murry Englard CPA | Net Income: How It Works and Why It Is Important
Net income is a business’s profit or loss after deducting all its operating costs. It is also known as “the bottom line,” and it’s the profit left over for owners to take home. Net income might not seem important, but it can tell how well your business is doing and what you need to grow. This article will help you understand net income and why it matters so much for entrepreneurs.
What Is Net Income?
First, you have to understand your gross income.
Gross income is the total amount of money your business brings in from sales before any deductions are made. Depending on how often the numbers are tallied up, it can be expressed as a monthly or yearly figure. For example, if a business makes $100,000 in sales for a year, its gross income is simply 100k.
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