Net income
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(Redirected from Net Income)
Net income is equal to the income that a firm has after subtracting costs and expenses from the total revenue. For a merchandising company, subtracted costs may be the cost of goods sold, sales discounts, and sales returns and allowances. For a product company advertising, manufacturing, and design and development costs are included.
Net income is sometimes called the bottom line because it is typically found on the last line of a company's income statement.
An equation for net income in merchandising:
- Net income = Revenue - Cost of goods sold - Sales discounts - Sales returns and allowances - Expenses = Profit
