The correct answer is A. net income.
Net income is a company’s total earnings after all expenses and taxes have been paid. It is calculated by taking a company’s revenue and subtracting its expenses, including cost of goods sold, operating expenses, and interest expense. Net income is then adjusted for taxes to arrive at the company’s net income after tax.
Net income is an important measure of a company’s financial performance. It is used to calculate a company’s earnings per share (EPS), which is a measure of how much profit a company makes per share of stock. EPS is used by investors to compare the performance of different companies and to determine whether a company’s stock is a good investment.
Net income is also used to calculate a company’s return on equity (ROE), which is a measure of how profitable a company is relative to its equity. ROE is calculated by dividing net income by a company’s equity. A high ROE indicates that a company is generating a lot of profit from its assets.
Net income is an important measure of a company’s financial performance. It is used to calculate a company’s earnings per share, return on equity, and other important financial ratios. Net income is also used by investors to compare the performance of different companies and to determine whether a company’s stock is a good investment.
Here is a brief explanation of each option:
- A. Net income: Net income is a company’s total earnings after all expenses and taxes have been paid. It is calculated by taking a company’s revenue and subtracting its expenses, including cost of goods sold, operating expenses, and interest expense. Net income is then adjusted for taxes to arrive at the company’s net income after tax.
- B. Net earnings: Net earnings is another term for net income. It is the total amount of money that a company makes after all expenses and taxes have been paid.
- C. Net expenses: Net expenses is the total amount of money that a company spends on its operations. It includes costs such as cost of goods sold, operating expenses, and interest expense.
- D. Net revenues: Net revenues is the total amount of money that a company receives from its customers. It is calculated by taking a company’s sales and subtracting its returns and allowances.