Gross income is the total of all gains or income other than the remuneration or earnings of capital over a given period of time.
Gross Income=Revenue-Costs
Net Income=Revenue-Costs-Expenses
Net Income is the income left after subtracting expenses from Gross Income, which includes depreciation, retention, benefits, dividends, interest, etc. Of course, there are specific algorithms for special accounts,
such as non-recoverable accounts, which are considered to be in the minority and can be disregarded. Can not be calculated. Gross income is the main business revenue only minus the main business costs. Look at the level of profitability of the main operating programs. Net profit is the profit after tax of all gains and losses.
Expanded information:
1, accounting for main business income
"Main business income" account is used to account for the enterprise in the sale of goods, the provision of services and the transfer of the right to use assets and other day-to-day activities of the income generated. Under the "main business income" account, a detailed account should be set up according to the type of main business for detailed accounting. This account shall have no balance at the end of the period.
2. Revenue from the provision of services
If the results of the transaction of the provision of services can be reliably estimated at the balance sheet date, the percentage-of-completion method shall be used to recognize the revenue from the provision of services.
(1) The conditions under which the results of the transaction of providing labor services can be reliably estimated.
1) the amount of revenue can be measured reliably, means that the total amount of income from the provision of labor services can be reasonably estimated;
2) it is probable that the related economic benefits will flow into the enterprise, means that the likelihood of recovering the total amount of income from labor services is greater than the likelihood that it will not be recovered;
3) the progress of the transaction can be reliably determined, means that the progress of the transaction to complete the reasonable estimate;
4) the progress of the transaction to complete the percentage of completion method is used to recognize. p>
4) The costs incurred and to be incurred in the transaction can be measured reliably, meaning that the costs incurred and to be incurred in the transaction can be reasonably estimated.
(2) Specific Application of Percentage of Completion
Percentage of Completion Method, is a method of recognizing revenues and expenses in accordance with the progress of completion of a transaction for the provision of labor services.
Baidu Encyclopedia-Revenue