income that a business has from its normal business activities

Revenue (or revenues) is income that an organization receives from its normal business activities.[1] In the case of a corporation this is usually from the sale of goods and services to customers. In the case of a government, revenue usually comes from various taxes.[2] In addition to sale of goods and services, some companies also receive revenue from interest, dividends or royalties paid to them by other companies.

First and foremost, it's important to note that revenue isn't the same thing as profit. Profit represents what is left over after all expenses are subtracted from revenues (gross margin). It would be possible for a company to generate high levels of revenue without earning any profit at all. For example, if Company A makes $1 million in sales but incurs $2 million in costs, then Company A will have zero net profit (or alternatively negative net profits).[3]

References change

  1. "Revenue". Investopedia, LLC. Retrieved 10 June 2016.
  2. "What are the sources of revenue for the federal government?". Tax Policy Center; Urban Institute & the Brookings Institution. Retrieved 10 June 2016.
  3. "Revenue".