\nThe following is my understanding of operating vs net income.<\/p>\n
\nOperating income<\/em> refers to income made from a business’s fundamental activities less expenses incurred therefrom. Therefore, it doesn’t deduct taxes or interest payments, since they are not from business activity.<\/p>\n \nThat being said, operating income may not count “other income,” either. An example might be as follows: Suppose a manufacturing business finds a great deal on supplies that it doesn’t use. It buys them anyway, then turns them over at a profit. Said profit might not add into “operating income,” since buying and selling supplies isn’t part of the manufacturing business. However, like interest payments and taxes, it would be considered in net income.<\/p>\n Source:<\/p>\n investopedia.com<\/a><\/p>\nJack of Oracle Tutoring by Jack and Diane,<\/a> Campbell River, BC.\n","protected":false},"excerpt":{"rendered":" Self-tutoring about accounting definitions: the tutor mentions operating income. The following is my understanding of operating vs net income. Operating income refers to income made from a business’s fundamental activities less expenses incurred therefrom. Therefore, it doesn’t deduct taxes or …<\/p>\n