Which of the following describes the income generated from the sale of goods?

• A. Cost of goods sold
• B. Revenue
• C. Profit margin
• D. Net earnings

Answer: (B)

The income generated from the sale of goods is best described as revenue. Revenue represents the total amount of money earned from sales before any costs or expenses are deducted. This is a crucial concept in business, as it reflects a company's ability to generate income through its operations.

When a business sells its products or services, the money that comes in from those sales qualifies as revenue. Understanding this concept is vital for measuring a business's financial performance and determining its overall health.

In contrast, the other terms referenced refer to different aspects of financial statements and business operations. The cost of goods sold relates to the direct costs attributable to the production of the goods sold by the company, while profit margin indicates the percentage of revenue that exceeds the costs incurred, and net earnings represent the profit remaining after all expenses and taxes have been deducted from revenue. Each of these terms plays an important role in financial analysis, but when specifically discussing the income from sales, revenue is the appropriate term to use.