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Bottom line

What is a bottom line?

The "bottom line" refers to the net income, or profit, a business has earned. It's called the bottom line because it's typically found at the bottom of the income statement, after all expenses, including taxes and interest, have been subtracted from revenues.

The bottom line provides a clear picture of a company's profitability. An increasing bottom line indicates that the company is profitable and managing its costs effectively, while a decreasing bottom line may signal trouble. In addition to reviewing the bottom line, investors and stakeholders often consider other factors, such as revenues and operating income, to assess a company's financial health.

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