4. Money paid as salaries or wages to employees
Business exclude Money paid as salaries or wages to employees from its net income under “operating surplus”.
Money paid to the employees as salaries represents the amount of monetary an entity obtain after deducting all expenses incurred during the operation.
Salaries or wages to an employee are part of these operating costs.
As salaries for employees go up, the amount of income a business has in the future will be reduced.