What is Net Profit / Net Income Or Net Loss In Accounting
N et Profit / N et Income means the net result of Income / Revenues minus Expenses i.e., Revenues - Expenses or during a particular Accounting Period Revenues exceeds the Expenses of the same period while N et Loss is the reverse situation i.e., it it the excess of Expenses over Revenues or Income during a Accounting Period. Profit or Loss is very important factor for checking Financial Performance of the business. To Find out Net I ncome / Net Loss for the Accou nting Period, Income Statement or Profit And Loss Account is prepared. In the form of Equation, we write as: N et Profit / N et Income / N et Loss = Revenues - Expenses It is also calculated in case of Sole Proprietorship as shown below: Open i n g Capital + Further Capital I n troduced + (N et Income) - ( N et Loss ) - Drawi n gs = Closi ng Capital N et Income / N et Loss = Closing Capital - Open i n g Capital - Further Capital I n troduced + Drawi ngs ...