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Often, the term income is substituted for net income, yet this is not preferred due to the possible ambiguity. Net income is informally called the bottom line because it is typically found on the last line of a company's income statement (a related term is top line, meaning revenue, which forms the first line of the account statement).
A net (sometimes written nett) value is the resultant amount after accounting for the sum or difference of two or more variables. In economics , it is frequently used to imply the remaining value after accounting for a specific, commonly understood deduction.
More commonly, this is reported on the income statement as "income (or loss) before taxes". Taxes are then subtracted from the pre-tax income to give a final net income or net profit (or net loss) figure. Net income or net profit which is not expended to shareholders in the form of dividends becomes part of retained earnings.
An extremely important definition of income is Haig–Simons income, which defines income as Consumption + Change in net worth and is widely used in economics. [ 2 ] For households and individuals in the United States , income is defined by tax law as a sum that includes any wage , salary , profit , interest payment, rent , or other form of ...
Conversely, high net income growth would be tainted if a company failed to produce significant revenue growth. Consistent revenue growth, if accompanied by net income growth, contributes to the value of an enterprise and therefore the share price. Revenue is used as an indication of earnings quality. There are several financial ratios attached ...
It is opposed to net income, defined as the gross income minus taxes and other deductions (e.g., mandatory pension contributions). For a business, gross income (also gross profit , sales profit , or credit sales ) is the difference between revenue and the cost of making a product or providing a service, before deducting overheads , payroll ...
Fixed-income funds. Fixed-income funds, or bond funds, invest in government bonds, corporate bonds and other debt securities that pay a set rate of return. Often, they’re actively-managed and ...
In applied fields the word "tight" is often used with the same meaning. [2] smooth Smoothness is a concept which mathematics has endowed with many meanings, from simple differentiability to infinite differentiability to analyticity, and still others which are more complicated. Each such usage attempts to invoke the physically intuitive notion ...