Net Income Calculator helps the user to calculate the earnings left with the entity after paying off all its expenses during the accounting period. It provides a platform to assess the profit of the company. It gives a glimpse of the income information of the company. And also helps the management in forecasting and making a comparison between companies of the same industries. The management can also make a comparison with budgets as well as past years’ performance.
Net income can be calculated by deducting all total expenses from total revenue. A mathematical representation of the net income formula is as follows:
Net Income = Total Income – Total Expenses.
Net Income Calculator
How to Calculate using Calculator?
The user has to just insert the following data into the calculator for the instant result of the calculation with a simple click.
Total Income – Total income comprises the revenue from operations and other incomes such as interest income, commission income, profit from the sale of assets, dividend income, and all other incomes. This figure can be obtained from the income statement of the company.
Total Expenses – Total expenses of the company are divided into various broad categories such as cost of material consumed (raw material, WIP, finished goods), purchases, changes in inventory, operating expenses, depreciation and amortization, finance cost (interest), taxes, and other expenses.
If the calculator return a positive figure, it is net income. However, if the calculator returns a negative figure, the company is bearing a net loss.
