Non-Operating Revenue
Non-Operating Revenue is income derived from activities not related to a company`s primary business operations, such as investments or asset sales.
Benefits
Non-operating revenue can enhance overall profitability, provide financial stability, and offer additional income sources without relying on core business operations.
Frequently Asked Questions
What is an example of a non-operating revenue?
An example of non-operating revenue is the income earned from investments, such as capital gains from the stock market. For instance, if a retail store invests $10,000 in stocks and earns a 5% return, the $500 gain would be considered non-operating revenue.
What is the difference between operating and non-operating revenues?
Operating revenues are generated from a company`s core business activities, such as sales of products or services. Non-operating revenues are generated from activities not related to the core operations, such as investments, asset sales, or interest income.
What is a non-operating expense example?
An example of a non-operating expense is interest expense on a company`s debt. Other examples include losses from the sale of assets and restructuring costs.
Key Takeaway
Non-operating revenue is a valuable component of a company`s financial health, providing additional income from activities outside the core business operations and contributing to overall profitability.