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Net income is defined in the tax laws to mean net income as calculated for tax purposes. Income is not defined. To apply section 97 it is necessary to know what the income of the trust is and what a beneficiaryâs share of that income is.
Adjusted net income accounts for these factors in addition to a company's bottom line. The calculation of adjusted net income begins, as its name implies, with net income. Net income is the sum total of all revenue, expenses, debts, taxes, interest and additional income for a given period. This is the most comprehensive metric of profitability for a company's operations.