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### Financial Calculator

 Net Income ( NI )
 Written by Kenny Foo Friday, 06 March 2009 15:05 Investment Formula Description Net income ( NI )  is remaining profit for the company after subtracting all the expenses from total revenue in the a given financial period of time. Net income ( NI ) is also referred as net profit since it is the actual profits or earnings after deducting all the expenses such as cost of goods sold ( COGS ), overhead , interest payable plus/minus one extraordinary items for a financial period ( usually one year) . If the outcome of net income ( NI ) is negative figure after deducting all the expenses, then it is called net loss. Net Income ( NI ) is commonly used together with profit margin. Sometimes, net income ( NI ) is also referred as net profit and both of them serve the same meaning. Investment Formula Net Income ( NI ) = Revenue - Cost of goods sold - Overhead - Interest Payable = Gross Profit - Overheads - Interest Payable Investment Formula Example For this financial period, Corporation A has total \$50,000 revenue with \$30,000 of COGS,  \$10,000 of Overheads,  and \$5,000 of Interest Payable. Net Income ( NI ) = Revenue - Cost of goods sold - Overhead - Interest Payable = Gross Profit - Overheads - Interest Payable = 50,000 -  30,000 - 10,000 - 5,000 = \$5,000 The net income ( NI ) or net profit for Corporation A is \$5,000 for this financial period. For the next financial period, the Overheads for Corporation A had increased to \$12,500. Net income ( NI ) = Revenue - Cost of goods sold - Overhead - Interest Payable = Gross Profit - Overheads - Interest Payable = 50,000 -  30,000 - 10,000 - 12,500 = - \$2,500 In this case, Corporation A is having net loss of \$2,500 for this financial period. Last Updated ( Friday, 06 March 2009 15:57 )