The Primary Difference Between Revenues and Gains Is

question 5

Multiple Choice

The primary difference between revenues and gains is:

• A)Gains are increases in net assets from periodically selling assets (other than inventory),while revenues are increases from major or central ongoing operations of a business.
• B)Revenues increase operating income and gains have no impact on net income.
• C)Revenues cause increases in net assets as a result of infrequent activities and gains cause increases through ongoing activities.
• D)Gains result in an increase in operating income whereas revenues do not impact operating income.

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Definitions:

Cash

Physical form of currency such as coins and banknotes; in accounting, cash also includes balances in bank accounts.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities.

Liabilities

Financial obligations or debts that a company owes to external parties or entities.

Assets

Assets are resources owned or controlled by a business, expected to bring future economic benefits.