Capital And Revenue Income Flashcards
1
Q
What is capital income ?
A
Money used to setup a business
2
Q
Examples of capital income (5)
A
Mortgage
Owners capital
Loan
Shares
Debenture
3
Q
Tell me about debentures
(Normally secured against an asset)
A
Long term loan issued by a company to raise capital. Investor becomes debenture holder when they invest. They receive interest and get repaid by the company on an agreed date
4
Q
What is revenue income
A
Income received on the sale of goods and services
5
Q
Examples of revenue income (6)
A
Interest received
Cash sales - money coming into the business from sales of goods and services
-Credit sales
-Rent received
-Discount received
-Commission received