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Unearned income

Unearned Income

 

(Share price – share value) * shares issued = unearned income

Is the income coming from investments. The way this income works is when a company issues shares, let’s say worth 1 cent, they sell them for 1 dollar to the investors, so they are making 99 cents per each share issued, so these 99 cents per sold shares is what we call unearned income.

This source of income is key for startups or businesses that just started and are not established on well-known yet, this will help them finance their operations and increase their capacity.

 

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