Net Income of a Socialist Enterprise, a part of net income of society. Quantitatively, the net income of a socialist enterprise is the difference between the monetary gain from the sales of products at the wholesale prices of the enterprise (see Wholesale Prices) and its actual production cost. The less the enterprise expends on the manufacture of the products, the higher the net income. Therefore, all the factors raising the efficiency of social production at the same time increase the enterprise’s net income, which also depends on the level of the price of the product. The surplus product is, above all, the material content of the enterprise’s net income. In actual practice these two forms may not coincide in each concrete case because, first, the wholesale price of an enterprise’s products does not coincide with the value; second, the extent of production costs deviates from the corresponding part of the products’ value; and third, an enterprise’s net income, besides the value of the surplus product, includes part of the necessary product (deductions from the profit to the material incentive, sociocullurai and housing funds). The socialist nature of the surplus product makes an enterprise’s net income socialist in content. The income, like the surplus product, is national wealth, and expresses the relations of socialist cooperation in production, sales, distribution and use of part of the newly created value. The net income of a socialist enterprise is formed, as is the net income of society as a whole, in the process of the planned management of the production process, of the establishment in the plans of enterprises of the volume, range of goods and product price. No matter what the forms of distribution and redistribution of the net income are, in the final analysis it is used in the interests of the working people. An enterprise’s net income is distributed as follows: one part goes into the centralised net income of the state, and the other is used by the enterprise for developing production and for satisfying the collective’s various requirements. It goes into the production development fund, the material incentives fund and the sociocultural and housing fund (see Economic Incentives Funds). The system of distribution of an enterprise’s net income is based on taking due account of the economic laws of socialism, and is aimed at making the collective and individual workers more interested in the ultimate production results and in making production more efficient.