When Apple sells inventory for revenue, how does this affect Net Income?

When Apple sells inventory for revenue, it results in an increase in Net Income. This occurs because the revenue generated from the sale contributes directly to the top line of the income statement. In accounting terms, sales revenue is recognized at the time of sale, which positively impacts Net Income after considering the cost of goods sold (COGS).

If the sale price of the inventory exceeds the associated COGS, the excess contributes to gross profit, further elevating Net Income after all operating expenses, taxes, and other costs have been subtracted. This direct relationship between revenue from sales and net profit illustrates how successful sales lead to increased profitability for the company.

In a broader context, successful sales indicate demand for a product, which contributes to a healthier financial position for a company, allowing for further investments and growth.