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Small business accountants in Melbourne explain the difference between income and revenue

Income and revenue are terms thrown interchangeably by the average person as they think it is the same thing. Our small business accountants in Melbourne will clear the confusion and explain the difference between income and revenue for all the entrepreneurs.

Revenue is simply the total amount of cash generated by the sale of products or services that are associated with the company’s primary operations, less any returns or discounts. This can also be thought of as net sales for your business.

In financial terms, income is almost always refers to the bottom line or net income. It is also referred to as net profit, this number represents the total amount of cash that remains from the original amount of revenue after calculating and accounting for all expenses.

It’s quite simple to distinguish the two, but we can see why it is so common for people to mix them up for one another due to the main purpose being positive cash flow.

Contact our small business accountants in Melbourne if you need any clarification!

 
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