The Net Income Formula Using Assets and Liabilities is an equation used to calculate the net income of a company. This figure is calculated by subtracting the sum of all expenses, liabilities, and equity on the balance sheet from the sum of all assets. In other words, it gives you an idea of how much money a company actually has after accounting for all its debts and investments. By keeping track of this figure, businesses can accurately gauge their overall financial position and make informed decisions about future investments and strategies.