Definition - What does Net Income mean?
Net income in a business is the amount of money that is left after all bills are paid and all accounts payable are taken into account, including taxes. Gross income is considered first in terms of all income that is brought into a company, and the company has a legal right as well as a legal obligation to deduct certain debts from their gross profits. There is a legal obligation for the employer to pay taxes on each employee's individual earnings, as well as a legal responsibility for the company to pay into the Social Security Administration in relation to their workforce.
Justipedia explains Net Income
Net income cannot be considered until all debts that would be owed in that period are paid in full. Accounting would list net income before showing the amount of profit or loss that was accrued in the year.
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