Term:INCOME

In accounting terms, this refers to all revenues received by a company, both as a result of its sales and other sources such as interest, dividends or rent. This figure is often called “turnover” or “revenue” and it must be stated on the Income Statement in terms of the Companies Act. In the profit calculation, the company’s variable expenses are deducting from its income to arrive at its gross profit – and then its fixed costs are deducted to arrive at its net profit. When looking at a company’s income statement, one very simply check you can make is to see whether the income from this accounting period is more by at least the inflation rate than the income of the previous comparable period. Because if it is not then the company is going backwards.

Disclaimer - All information and data contained within the PDSnet Glossary terms is for informational and educational purposes only. PDSnet makes no representations as to the accuracy, completeness, suitability, or validity, of any information, and shall not be liable for any errors, omissions, or any losses, injuries, or damages arising from its display or use. Information in the PDSnet glossary terms is based on the author’s opinion and experience and should not be considered professional financial investment advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional. Thoughts and opinions will also change from time to time as more information is accumulated. PDSnet reserves the right to delete any glossary term for any reason.« Back to Glossary Index