Definition of Net cash income

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TeachMeFinance.com - explain Net cash income



Net cash income

The term 'Net cash income ' as it applies to the area of agriculture can be defined as ' A farmís actual cash receipts and expenses in a given year, regardless of the year the goods sold were produced. In general, it serves as an indicator of the short-term financial condition of agricultural producers and their ability to pay household expenses, farm operating expenses, loan payments, and to purchase capital assets such as machinery. It consists of cash receipts from farm marketings of crop and livestock products, other cash income from such farm-related sources as machine hire, custom work and farm recreational activities, and direct government payments, less production expenses paid in cash. It excludes the non-monetary components of gross farm income and net farm income'.

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Mark McCracken

Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English".


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