What Is Gross Income?

Business & Management
#1

An individual’s gross income, often known as gross pay on a paycheck, is the entire compensation received from his or her employer before taxes or other deductions. This covers all types of revenue, not just cash; it also includes property or services obtained. The amount of money a person makes in a year before taxes, including all sources of income, is referred to as gross annual income.
Gross income is synonymous with gross margin or gross profit in the business world. The revenue from all sources minus the firm’s cost of products sold equals a company’s gross income, as shown on the income statement (COGS).
​Gross Income=Gross Revenue−COGS
where:
COGS=Cost of Goods Sold​

#2

Gross income is simply all your money without taxes or insurance deductions. Here is an example. John Doe gets paid on Friday his paycheck is for $850.00. $50.00 was taken out for Federal taxes,$25.00 was taken out for State taxes $75.00 was deducted for insurance. Your total deductions $50+$25.00+$75.00=$150.00.

If you add your $150.00 to your $850.00 take home pay you would get $1000.00. $850.00+$150.00=$1,000. The $1,000 is your gross and the $850.00 is your net.