/ / Income: is it all me or should I share?

Income: is it all me or should I share?

Nowadays, the concept of profitability is more relevant than ever. And if earlier income was a purely entrepreneurial concept, now we are all somehow connected with it.

In essence, income is the sum of cash receipts.or material values ​​of a specific entity (individuals, legal entities or the state as a whole) for a certain period, which is the result of any activity permitted by law.

Income is
Помимо этого, есть еще такой термин, как чистый income. There are quite a lot of opinions and judgments concerning the interpretation of this concept. Quite often, net income is defined as revenue, taking into account the deduction of all expenses from it. But in this case it will be a profit.

In fact, this indicator is oftenconfused with income, but in practice these are different concepts, and profit is just the end result of the enterprise. It is calculated as the income from which all expenses and obligatory payments have been deducted. In this case refers to the net profit.

What then is the net income?These are all monetary or material receipts, with the exception of some mandatory payments (value added tax, excise duty), as well as other deductions from income. Such a calculation sequence can be seen in the Statement of Financial Results. And where, if not there, to seek an answer to the question of the formation of income and profit?

Consider these concepts by example.

Net income is
Let's say a firm has sold an item worth X, whichwill be her income. This is the first category. When a firm deducts VAT from this amount, we will get Y, that is, net income. But when we still deduct the cost price (which, incidentally, is gross profit), wastes on labor, delivery, transportation, maintenance of administrative staff, depreciation, income tax and other costs, we will get a net profit. In fact, this is the amount of funds that you can dispose of, and from which you do not need to subtract anything. But if the expenditure exceeds the income - it will be a loss.

Such an algorithm concerns financial accounting.In the tax system, everything looks a little different. Due to the fact that in her income is any cash flow to the account, and in the financial accounting system - on the first event. That is, if the goods are shipped, then its sale value is displayed as income received, even if the buyer has not yet paid the order. And if the advance payment for the goods has been made to the firm’s account, but the latter has not yet been shipped, then the date of the transfer of funds will be considered as income.

Revenues this
If we talk about individuals, namely peoplenon-entrepreneurs, income is the sum of all cash receipts (wages, additional part-time work, gifts, etc.). If we deduct taxes and social funds from this amount, we will receive net income. And when we deduct expenses for food, transport, clothes, etc. from this indicator, then there will be (if lucky) a profit that can be deferred to generate additional income in the form of interest.