Wednesday, July 15, 2009

Revenue

In business, revenue or revenues is income that a company receives from its normal business activities, usually from the sale of goods and services to customers.Some companies also receive revenue from interest, dividends or royalties paid to them by other companies.

Profits or net income generally imply total revenue minus total expenses in a given period. In accounting and financial analysis, revenue is often referred to as the top linedue to its position on the income statement at the very top. This is to be contrasted with thebottom line which denotes net income.

For non-profit organizations, annual revenue may be referred to as gross receipts.This revenue includes donations from individuals and corporations, support from government agencies, income from activities related to the organization's mission, and financial investments such as stock shares in companies.

In more formal usage, revenue is a calculation or estimation of periodic income based on a particular standard accounting practice or the rules established by a government or government agency. Two common accounting methods and accrual basis accounting, do not use the same process for measuring revenue.

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