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5 Accounting Terms You Must Know to Understand Financial Reports

5 Accounting Terms You Must Know to Understand Financial Reports

Submitted by • August 29, 2019

Net income is the same as net earnings and net profit. Net income is the total amount of profit your business makes after deducting all expenses from revenue. The expenses include the cost of goods sold, overhead and tax.

Net income is a good measure of how you are doing. A loss shows your business is not doing well. A profit is a good thing but is it good enough? You’ll need other measures to assess whether the profit your business makes is adequate.

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