Net Income

Net Income (NI): Definition, Uses, and Formula:

Net income (NI), also called net earnings, is a useful number for investors to assess how much revenue exceeds the expenses of an organization. The formula to determine net income is sales minus cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses.

Net income appears on a company’s income statement and is an indicator of a company’s profitability. Net income also refers to an individual’s income after taking taxes and deductions into account.