explain the concept of Income ?



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Explain the concept of Income in accounting with reference to profit reporting . Give suitable illustration.

2 Answer(s)


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Income is the acquisition of money via a regular source, including money that you earn through work, or any allowance that you might receive on a regular basis.

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Revenue & income are different & have different applicability when it comes to reporting. Usually income is what is left after accounting for & deducting all expenses from revenue. Revenue is all the money generated from sale of products & services of a business.
If you have a sales/revenue of Rs. 25,00,000/- in your business, whereas the expenses incurred for generating the above revenue are Rs. 15,00,000/-, your income would be Rs. 10,00,000/-. This is applicable for business entities. For a person earning a salary of Rs. 1,00,000/-, income would be Rs. 1,00,000/- as he is not entitled to claim expenses against his incomes & also would not maintain books of accounts for the salary that he earns.

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