The net income formula is a vital part of assessing business performance. It’s the equation used to calculate all the profits of the business minus expenses over a certain period of time. In simplest terms, it is Assets minus Liabilities. By knowing this figure, businesses are able to gauge their success and adjust strategies when needed. This is a core element of savvy financial planning – because if you know your net income, you can better plan for the future and ensure there is enough liquidity to cover operations. Additionally, understanding your net income helps you make smart decisions about where to invest resources in order to maximize returns. Knowing your net income has never been more important.