Which term describes the money collected from the sale of goods and services, calculated as price times quantity?

• A. Revenue
• B. Cost
• C. Profit
• D. Contribution

Answer: (A)

Revenue is the money collected from the sale of goods and services. It is calculated as price times quantity, representing the total sales income before any costs are deducted. This is the top line you see on an income statement and it grows with higher prices or more units sold. For example, selling 50 units at $20 each gives $1,000 in revenue.

Costs are the money spent to produce or deliver the goods and services, including fixed costs (like rent) and variable costs (like materials). Profit is what's left after subtracting all costs from revenue. Contribution refers to revenue minus variable costs, showing how much is available to cover fixed costs and contribute to profit.