Gross income is an important economic indicator

Gross incomeGross income of the enterprise

This indicator represents the amount of profit that the organization receives as a result of its business activities. Most often in the role of such basic forms of activity is the sale of goods or the provision of various services. Currently, the concept of "gross income" is synonymous with the term "turnover" in many countries that occupy high positions in the world ranking. There are also companies that receive the above profits from dividends, interest and royalties that other organizations must pay them. Gross income can be expressed as a total amount for the entire period, and for a certain period. In this case, the currency in which the amount of profit can be clearly represented can be indicated. Nevertheless, for companies of a non-commercial type, annual gross income and profits are expressed in the concept of "profit from financing".Such a definition includes various donations, investments by government agencies, and profits from economic activities regulated by the company's charter. In addition, this category may include income from shares and authorized capital, as well as all sorts of membership fees.
Gross income of the enterprise

Exceptions

At the same time, it should be noted those articles that do not relate to the concept of "gross income". This is the profit from the sale and sale of surplus property or previously acquired material and commodity values, since it cannot be considered the result of the business activity of the organization. Also, this category should not include the value of the property or the amount of funds that were received as a result of a court decision.

The composition of the indicator

The gross income of each organization is a combination of the following forms:

  • profit from the sale of securities, as well as goods, works and services;
  • benefit from performing insurance, banking and other operations related to financial activities;
  • trade in valuables and currency;
  • fulfillment of debt claims and obligations.

In addition, this article traditionally refers to:

  • the profit received as a result of joint activity with the adjacent enterprises and the organizations;
  • dividends issued by non-residents;
  • leasing operations;
  • profit gained from non-operating activities.

Gross income and profitA typical example of operations of this kind can be considered donations and other irrevocable financial assistance, a set of insurance reserve funds. It is also possible to credit funds that were not taken into account in a timely manner, and therefore, were not taken into account in the accounting reports on gross income for previous periods. Nevertheless, they must necessarily be attributed to the considered period of time.

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