The amount that results from distracting specific items from an entity’s income, depending on its form and business line. For a commercial entity, such items mainly include goods sold, expenses, depreciation and amortization, interest, and taxes for an accounting period. Net income, also known as net earnings, is sales (revenues from the sales of products and/or services relating to an entity’s core operations/ activities) minus cost of goods sold (or services provided), general expenses, taxes, and interest.

Generally speaking, net income (NI) is the amount of accounting profit an entity has left over after covering all its relevant expenses. In other words, is the excess of revenues over expenses for a specific period of time (an accounting period). Net income is usually perceived as one of the key indicators of profitability for an entity.