![]() ![]() Sale proceeds from the sale of goods/ services.Few examples of operating revenue depending upon individual business are as follows. It excludes the income from extraordinary items. Operating revenue provides information about the profitability and productivity of the primary business of the company. It is the income generated from the core business of the organisation. Operating Revenue – Operating revenue can be defined as income and earnings made from the day to day business of the company. Any revenue/ expense item will be classified as an operating item if it is related to prime business objectives or is incurred in relation to such revenue generation activities. ![]() Creditors use this calculation, investors and other stakeholders to evaluate the business operating efficiency and to further process financial decisions. For example, in real estate, check a commercial property’s financial health and profit potential by determining the relevant income after deducting all related operating expenses. Net operating income is the formula for measuring profitability and is generally used in determining an entity’s net profit generation capacity from its core business activities. income figured out by deducting all the operating expenses of the company from its entire operating revenue, whereas all the non-operating expenses like tax expenses, interest, loss on the sale of capital assets are excluded from its calculation. Net operating income is a profitability measure which can be defined as the sum of money earned by an organization from its core business operations, i.e. ![]()
0 Comments
Leave a Reply. |