Question

Which of the following is true about net income?

1) It is the amount of income after cost of goods are deducted
2) It is also known as pre-tax
3) It raises fees on interest rates
4) It improves credit scores

Answer 1

Net income is the amount of income after cost of goods are deducted.

Step-by-step explanation:

The correct answer is option 1) It is the amount of income after cost of goods are deducted. Net income refers to the amount of income a company or individual earns after subtracting the cost of goods sold (COGS) and all other expenses, including taxes. It is also known as profit or earnings. For example, if a company's revenue is $100,000 and the total expenses including COGS are $60,000, then the net income would be $40,000.