Understanding Income, Revenue, Earnings: Key Differences
Defining Revenue and Earnings
In the world of finance, income, revenue, and earnings are commonly used terms that often get interchanged, but there are distinct differences between these concepts.
Revenue represents the total amount of money received by a company from the sale of goods or services during a specific period.
Earnings vs. Revenue
Earnings, also known as net income, is the amount of profit a company retains after deducting expenses, taxes, depreciation, and other charges from its revenue. In short, earnings measure a company's profitability.
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