Revenue Vs Income Vs Profit

From net sales we deduct all the expenses including the operating costs and we get the income.

Revenue vs income vs profit. In short we can say profit is the revenue which is left after deducting the expenses. Total revenue is interdependent of profit and will exist since it is the reason for a business being established. However profit may not necessarily accrue. Revenue is the total income generated by a business from the sale of goods services whereas profit is the surplus which remains after deducting all expenses and taxes associated.

From the income or revenue. We start the income statement by gross sales and then deduct the sales return or sales discount. While revenue includes the gross earning from primary operations without any deductions profit is the resultant income after accounting for expenses expenditures taxes and additional income and costs in the revenue. So while revenue shows the total amount of money coming in income shows the total amount coming in and out.

And we get net sales. Revenue is the total amount of sales generated by a company while income refers to the net profit earned minus expenses. The key difference between profit vs income is that profit of the business refers to the amount realized by the company after deducting the expenses from total amount of revenue earned during an accounting period whereas income refers to the amount left as the earning in the organization after deducting other expenses such as dividends etc from the profit amount. Revenue is divided into operating and non operating revenue profit is classified as gross and net profit and income can be classified as earned and unearned income.

Revenue is the gross amount i e. Without any deductions while profit and income are derived after deductions of expenses and taxes. Profit the actual reward for the risk taken by the businessman in the business.