Photo AI
Explain the following terms: (i) Gross Income (ii) Net Income - Leaving Cert Home Economics - Question 11 - 2019
Question 11
Explain the following terms: (i) Gross Income (ii) Net Income
Worked Solution & Example Answer:Explain the following terms: (i) Gross Income (ii) Net Income - Leaving Cert Home Economics - Question 11 - 2019
Step 1
Gross Income
Answer
Gross Income refers to the total income earned by an individual or entity before any deductions or taxes are applied. This encompasses all sources of income, including wages, salaries, bonuses, rental income, and investment earnings. Essentially, it represents the overall inflow of earnings in a given period.
Step 2
Net Income
Answer
Net Income is the amount of income that remains after all deductions, such as taxes, social security, and other withholdings, have been subtracted from the gross income. It is often referred to as "take-home pay" since it reflects the actual amount available to the individual or entity for spending or saving.