Accountıng I Deneme Sınavı Sorusu #1313622
What is the difference between a business's revenues and its expenses?
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The difference between a company's revenues and expenses is called debts of the company during an accounting period. |
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Net income or loss represents the difference between a company's revenues and expenses during an accounting period. |
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The difference between a company's revenues and expenses is owner capital of the company during an accounting period. |
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The difference between a company's revenues and expenses is profit of the company during an accounting period. |
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The difference between a company's revenues and expenses is Accounts Payable of the company during an accounting period. |
Revenues. The company will receive assets (for example, cash) in exchange for goods sold and services rendered. Therefore, company’s assets and owner’s equity will increase. The increase in owner’s equity created by delivering goods or services to customers is called revenue.
Expenses. Expenses use up assets or create liabilities in the course of operating a business. The cost of operating a business is called expense. Expenses have the opposite effect of revenues; expenses decrease owner’s equity. Businesses will try to minimize expenses and thereby maximize net income.
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