Calculating net income is a crucial aspect of financial analysis in Malaysia. It represents the profit a business earns after deducting all expenses from its revenue. For instance, a company with RM100,000 in revenue and RM60,000 in expenses would have a net income of RM40,000.
Understanding how to calculate net income is essential for various stakeholders, including investors, creditors, and management. It provides insights into a company’s financial performance, profitability, and overall health. Historically, the concept of net income has evolved alongside accounting practices, playing a key role in business decision-making.