Net output: Difference between revisions

Revision as of 07:23, 14 February 2025

Latest revision as of 07:31, 14 February 2025

(One intermediate revision by the same user not shown)

Line 1:

{{Unreferenced|date=December 2009}}

{{short description|Accounting concept}}

'''Net output''' is an accounting concept used in [[national accounts]] such as the [[United Nations System of National Accounts (UNSNA)]] and the [[National Income and Product Accounts|NIPA]]s, and sometimes in corporate or government accounts. The concept was originally invented to measure the total net addition to a country's stock of wealth created by production during an accounting interval. The concept of net output is basically "gross revenue from production ''less'' the value of goods and services ''used up'' in that production". The idea is that if one deducts intermediate expenditures from the annual flow of income generated by production, one obtains a measure of the net new value inof the new productsgoods and services created.

==Definition==

Line 11:

==Components of net output==

The value of an aggregate net output is normally understood to be equal to the sum of:

*gross labour costs (or [[compensation of employees]]), .

*gross depreciation (or [[consumption of fixed capital]]), .

*income tax and indirect tax impostspaid onby producing productionenterprises, reduced by government subsidies paid to producers,producing enterprises during the same accounting period.

*gross (pre-tax) profit (or [[operating surplus]]) resulting from production.

In calculating net output for national accounts, government subsidies received by producing enterprises are normally subtracted from indirect tax levies paid by them during the same accounting period.

==Net output and GDP==