Revenue income describes the day-to-day sales of a business. Which of the following is revenue income?

• A. The day-to-day sales of the business (cash or credit)
• B. A loan received from the bank
• C. A capital injection by the owner
• D. The purchase of equipment

Answer: (A)

Revenue is money earned from the business’s normal trading activities, mainly by selling goods or providing services. It can come in as cash or on credit, because revenue is recognized when the sale happens, not only when cash is received. That makes day-to-day sales the source of revenue income.

A bank loan brings in cash but creates a liability and is considered financing, not revenue. A capital injection by the owner increases equity, not revenue. The purchase of equipment increases assets and reflects an investment in the business, not revenue.