difference between revenues and net income?


1 Answer(s)


The money a customer pays you when you sell a product or service is called Revenue.

The money you have left over after paying your expenses are called margins.

For example, if you run a pizza company and your customer pays Rs.100 for a pizza thats your revenue. From that Rs.100 revenue you have to pay Rs. 20 for the ingredients and you have Rs. 80 left - that is called your gross margins.

Now using your gross margins you will pay of your operating expenses like salary, rent etc and other expenses like interest tax etc. The final money you have left after paying of all your expenses is called net income.