Revenue

What is Revenue?

In accounting Revenue refers to the monetary amount from the sale of goods in which the business normally trades and which were bought for the purpose of resale.

For this reason Revenue will always affect the Stock (Inventory) of the business. If a business normally sells widgets then the ‘sale’ of for example, a motor vehicle used within the business, is not included in Sales.

Revenue is often referred to as Sales, or Turnover and normally they can be used interchangeably and mean the same thing. In the stricter sense, sales specifically refers to the act of selling whereas Revenue is the monetary value of the selling. Income is sometimes used but usually refers to a business in which services rather than goods, are sold.

For further information on Revenue see the Wikipedia definition.

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Last modified March 23rd, 2016 by Team

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