Revenue and Expense

Revenue - inflows of economic resources

• Sales – from daily activities
• Gains – increase in assets or equity from incidental transactions
• Investment income – e.g. interest and dividend income

Expenses – outflows of economic resources

• Cost of goods sold - direct costs related to the product or rendered service sold
• Selling, general and administrative expenses - not included in COGS but are related to the operation
• Depreciation and amortization
• Tax expense
• Interest expense
• Loss - decrease in assets or equity from incidental transactions