Net income

Net income is equal to the income that a firm can get after subtracting Cost of goods sold, sales discounts, sales returns and allowances (the above three items are all only for a merchandizing company) and expenses from the total revenue.

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Net income is sometimes called the "bottom line" because it is typically found on the last line of a company's income statement.

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To make it simple:

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Net income = Revenue - Cost of goods sold - sales discounts - sales returns and allowances - expenses

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Cost of goods sold: In accounting, the cost of goods sold describes the direct expenses incurred in producing a particular good for sale, including the actual cost of materials that comprise the good, and direct labor expense in putting the good in salable condition. Cost of goods sold does not include indirect expense...

Expense: In accounting, an expense is a general term for an outgoing payment made by a business or individual....

Revenue: :For the tax agency in Ireland of the same name , see Revenue Commissioners....

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