The difference between revenue and costs refers to how much profit or loss a business has made. This concept is typically referred to in accounting as "net income" when the revenue exceeds costs or "net loss" when costs exceed revenue.

In the context of your multiple-choice question, the correct answer is **net income or loss**.

**Explanation:**

1. **Net Income**: This occurs when a company's revenues exceed its expenses during a specific period. It is an indicator of the financial health of a company and is often the bottom line of the income statement.

2. **Net Loss**: Conversely, when a company’s expenses exceed its revenues, it results in a net loss, which indicates that the company is operating at a deficit.

The other choices provided (expense, tax, and retained earnings) do not directly represent the difference between revenue and costs. An expense is a cost incurred in the process of earning revenue, while taxes are liabilities owed to the government based on income. Retained earnings represent the cumulative amount of profit (net income) that a company retains rather than distributing it as dividends.

Question

The difference between revenue and costs refers to how much profit or loss a business has made. This concept is typically referred to in accounting as "net income" when the revenue exceeds costs or "net loss" when costs exceed revenue.

In the context of your multiple-choice question, the correct answer is **net income or loss**.

**Explanation:**

1. **Net Income**: This occurs when a company's revenues exceed its expenses during a specific period. It is an indicator of the financial health of a company and is often the bottom line of the income statement.

2. **Net Loss**: Conversely, when a company’s expenses exceed its revenues, it results in a net loss, which indicates that the company is operating at a deficit.

The other choices provided (expense, tax, and retained earnings) do not directly represent the difference between revenue and costs. An expense is a cost incurred in the process of earning revenue, while taxes are liabilities owed to the government based on income. Retained earnings represent the cumulative amount of profit (net income) that a company retains rather than distributing it as dividends.

Knowee AI · Accepted Answer

The difference between revenue and costs refers to how much profit or loss a business has made. This concept is typically referred to in accounting as "net income" when the revenue exceeds costs or "net loss" when costs exceed revenue.

In the context of your multiple-choice question, the correct answer is **net income or loss**.

**Explanation:**

1. **Net Income**: This occurs when a company's revenues exceed its expenses during a specific period. It is an indicator of the financial health of a company and is often the bottom line of the income statement.

2. **Net Loss**: Conversely, when a company’s expenses exceed its revenues, it results in a net loss, which indicates that the company is operating at a deficit.

The other choices provided (expense, tax, and retained earnings) do not directly represent the difference between revenue and costs. An expense is a cost incurred in the process of earning revenue, while taxes are liabilities owed to the government based on income. Retained earnings represent the cumulative amount of profit (net income) that a company retains rather than distributing it as dividends.

The difference between revenue and costs is called Blank______.Multiple choice question.net income or lossexpensetaxretained earnings

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The difference between revenue and costs is called Blank______.

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