Business Costs & Income Statements

Operational Expenses

an expense incurred in carrying out an organization's day-to-day activities, but not directly associated with production

Revenue

another term for "sales"

Income Statement

a financial statement that reports a company's revenues and expenses and resulting net income or net loss for a specific period of time

Cost of Goods Sold

cost of the inventory that was sold during a certain period

Fixed Costs

costs that do not vary with production or sales level

Variable Costs

costs that vary with the quantity of output produced

Income

earnings received as wages, salaries, bonuses, commissions, interest and dividends, or proceeds from the sale of assets

Start-up Costs

the expenses a new business must pay before it can begin to produce and sell goods

Break-even Point

the point at which the costs of producing a product equal the revenue made from selling the product

Profit

total revenue minus total cost

Loss

when a business's expenses are more than its revenues