Net proceeds definition
/What are Net Proceeds?
Net proceeds is the amount of funds received from a sale transaction, after all sale-related fees have been paid. Examples of these fees are closing costs, commissions, and credit card fees. These fees do not include the cost of the asset that was sold.
Types of Net Proceeds
Here are several examples of the net proceeds concept:
Net Proceeds from Asset Sales
Real Estate Sale Proceeds: Amount received after deducting closing costs, realtor commissions, legal fees, and taxes.
Vehicle Sale Proceeds: Amount received after dealer fees, loan payoffs, and title transfer costs.
Business Sale Proceeds: Net amount after brokerage fees, legal costs, and settlement of business debts.
Net Proceeds from Securities Transactions
Stock Sale Proceeds: Gross sale minus broker commissions and transaction fees.
Bond Redemption Proceeds: Net of redemption fees or early withdrawal penalties.
Mutual Fund Sale Proceeds: Net of exit loads, management fees, and other fund-related charges.
Net Proceeds from Financing Activities
Loan Proceeds: Disbursed loan amount after subtracting origination fees, underwriting costs, and service charges.
Bond Issuance Proceeds: Amount received after underwriting discounts, legal fees, and registration costs.
Net Proceeds from E-Commerce or Retail Sales
Online Sales Proceeds: Gross revenue minus platform fees (e.g., Amazon, eBay), payment processor fees (e.g., PayPal), and shipping costs.
Credit Card Sales Proceeds: Revenue after deducting merchant service fees and chargeback reserves.
Each type represents the actual cash inflow to the seller or issuer, providing a clearer picture of realized gains or usable capital.