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What is the cost of goods or services used to operate a business called?Received cash from sales, $1,100.00. Unlike a liability, which is an amount that is owed, the cost of goods or services used to operate a business is called an expense.
What do you call the amount received in exchange for the products or services sold to customers?Revenue is the money earned by a company obtained primarily from the sale of its products or services to customers. There are specific accounting rules that dictate when, how, and why a company recognizes revenue. For instance, a company may receive cash from a client.
What is a debit and credit in accounting?Debits and credits are terms used by bookkeepers and accountants when recording transactions in the accounting records. The amount in every transaction must be entered in one account as a debit (left side of the account) and in another account as a credit (right side of the account).
What is credit in accounting?In accounting, a credit is an entry that records a decrease in assets or an increase in liability as well as a decrease in expenses or an increase in revenue (as opposed to a debit that does the opposite). So a credit increases net income on the company's income statement, while a debit reduces net income.
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