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When a broker lists a business 'gross' and 'cash flow' in a 'For Sale' listing is cash flow the same as income?
Wiki User
∙ 8y ago
Not exactly. Cash flow simply refers to the flow of cash into and out of a business over a period of time. Watching the cash inflows and outflows is one of the major management tasks of an owner. The outflow of cash is measured by those checks you will write every month to pay salaries, suppliers, and creditors. The inflows are the cash you receive from customers, lenders, and investors. You can have positive cash flow (cash "in" to the business exceeds cash "out" of the business) or negative cash flow (cash "out" of the business exceeds cash "in" to the business). Positive cash flow is good; the only real worry is what to do with the excess cash. Negative cash flow is usually not good and can signal that the business is in trouble. There are three components of a cash flow statement: 1. Operating cash flow (or "working capital"--generated by sales of your product or service of your business--since it is generated internally it is under your control, which is good), 2. Investing cash flow (generated from investments in plant and equipment or other fixed assets, or other uses of cash outside normal operations), and 3. Financing cash flow (cash to and from external sources such as lenders). Profit, on the other hand, is Revenues less Expenses, and to truly identify how profitable a business is over a specific time period, you must first identify ALL revenues and expenses for period in question, usually one year. I could go on, but this answer is already too long. I recommend you Goggle for "Profit" and "Cash Flow" on the 'Net, or pick up a business book in your local library. Good luck!
Too put this in simple terms:
If cashflow(sales) are advertised as $1 million, and expenses (not including owners(your) wages are 900K, the business makes 100K net per year. You'd probably draw a salary of 60K-80K and be left with corperate profit of 20K-40K
Wiki User
∙ 8y ago
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Is gross income higher than net income?
Gross income in normally higher then net income unless there is other income then normal business operations then net income may be higher then gross income.
What is the business name for profit?
Gross income
In my tax return do I give my total net income or total gross income?
Most of your income is taxable on the gross income level. Some items are excluded from taxable gross income (such as pretax deductions from your paycheck for child care or medical expenses). Wage earners will enter the income in box 1 of their Form W-2 which is their taxable gross income. Other types of income are taxable at the net income level. If you have your own business, you can deduct business expenses from your gross income before adding the net income to your tax return. If you own a partnership, business expenses are deducted from gross income.
How to figure your net income on income tax form?
You net income is the amount listed in Box 1 of your W-2 form. If you are self-employed you compute your net income by listing your gross income and deductible expenses on your Schedule C of your business is a Sole Proprietorship and after deducting the expenses you will have your net income.
How much does your gross have to be to get the child's tax credit and does your business count as gross income?
YES! dummy
Difference between net income and gross income?
Gross income is the difference between revenue and direct expenses while net income is the income from all activities of business whether oprating activities or other activities.
How much is monthy gross income?
Your total income before taxes, but minus the business expenses incurred.
Is gross income or adjusted gross income used in refinance?
Gross income.
What income is higher net income or gross income?
Normally gross income is higher than net income as gross income only includes direct expenses for manufacturing of goods while in net income other administrative expenses are also deducted but even then net income may be high if company has other income which is not related to specific business related activities and this income is also have very significant amount otherwise gross income is normally more than net income.
What is the difference between Gross Revenue and Gross Profit?
Gross revenue is the total sales/income from the primary business activity. Gross profit is Net Sales minus Cost of Goods Sold. Look at a multiple-step income statement for clarification.
How is gross income different from net income?
net income is gross income less expenses
How do insufficient income effect a business?
The business does not have enough gross income to pay all of the expenses of the business operation under the present conditions and may need to take steps to reduce the expenses to a level that would produce sufficient income for this purpose.
