What is Interest Income?
Interest Income is the amount of interest a company earns, usually on the cash it has in the banks. When a company deposits cash in a bank, the bank has to pay interest on the cash. Just like how we earn interest in our bank accounts, companies earn interest on their deposits as well. That interest is a source of income for companies.
Whereas Interest Expense is the cost a company accrues for borrowing other parties’ cash, Interest Income is what the company earns for letting other parties (banks) use its cash.