Revenue account

Revenue expenditure includes the direct material costs and direct labor costs incurred in the manufac ture of a produc t, together with the associated overheads that include maintenance of the plant. Since these expenses are debits, the debit balance for a given accounting period is obtained by adding up the debit balances from each individual expenditure account. Similarly, since revenues from sales and other income are credits, the credit balance for a given accounting period is obtained by adding up the credit balances from each individual income or revenue account. 

A further convention is that working capital is paid in one sum at startup (together with those costs that are specific to the start-up process itself), and working capital (only) is repaid to the revenue account at the end of the project s life (together with any scrap value of the plant). 

Temporary revenue and expense accounts are used to classify changes affecting stockholders equity. Expense accounts covering legal expense (LP 40), depreciation expense (LP 41), and interest expense (LP 42) were created. A revenue account was not needed in January because there was no income. These ac-... 

Interest expense To close the expense and revenue accounts 42 20... 

In the first tier, with sales exceeding USD 1 billion, there are seven major companies whose combined gas-related revenue accounted for over 75% of the global market at the end of 2005 ... 

Maintenance costs account for a large fraction of the total operating expenditure (opex) of a project. Because of the bath tub curve mentioned above, maintenance costs typically increase as the facilities age just when the production and hence revenues enter into decline. The measurement and control of opex often becomes a key issue during the producing lifetime of the field as discussed in Section 14.0. However, the problem should be anticipated when writing the FDP. 

Closing the Books At the end of the accounting period, the individual accounts are closed by balancing each in accordance with Eq. (9-126). The balances are transferred either to the balance sheet in the case of capital expenditure or to the income statement in the case of revenue expenditure. An alternative name for the balance sheet is the position statement the income statement is also caUed the trading and profit-and-loss account. 

To ascertain profit or loss (calculated as income minus expenditure for a given accounting period), income and expenditure must be matched. For example, any rent paid in advance beyond the current accounting period should not be included in the profit or loss calculation. Similarly, goods sold but not yet paid for in a given accounting period should not be included in the revenue total for that period. 

Concept 5. Matching means that the revenue in a given accounting period should correspond to the expenses for that accounting period. 

The revenue from annual sales referred to in Eqs. (9-127), (9-131), and (9-132) is normally taken to be the gross turnover, which includes intergroup sales. However, intergroup sales are eliminated in consoh-dated or group accounts. Again, revenue from annual sales must be clearly defined before comparisons are made with other companies. 

Capital investment decisions are best made within the context of a life-cycle cost analysis. Life-cycle cost analysis focuses on the costs incurred over the life of the investment, assuming only candidate investments are considered that meet minimally acceptable performance standards in terms of the non-inonetary impacts of the investment. Using life-cycle analysis, the capital investment decision takes into account not just the initial acquisition or purchase cost, but maintenance, energy use, the expected life of the investment, and the opportunity cost of capital. When revenue considerations are prominent, an alternative method of analysis such as net benefit or net present value may be preferred. 

My lady mother was sitting at the table in the Great Chamber with the account books spread out before her, and Master Wooton the clerk hovering at her shoulder. We cannot hope that the revenues from France will recover. .. she was saying, as we entered. 

Revenues include cash received from sales of products and services. Cash received from the sale of equipment, buildings, and equipment is not considered revenue but is instead a decrease in the property and equipment accounts (assets). 

These cash expenses are those necessary to carry on the business, that is, expenses paid to generate revenue. A capital expenditure for plant or equipment generally is not an expense but an addition to the plant or equipment account (an asset). Typical expenses include cost of products sold, repairs, insurance, salaries, property taxes, and so on. 

B. l Capital Costs / B.2 Operating Costs / B. 3 Taking Account of Inflation / B.4 Predicting Revenues in an Economic-Based Objective Function / B.5 Project Evaluation / References... 

The top 10 pharmaceutical companies in July 2007 are shown in Table 1.4. These 10 companies account for almost half the global sales of drugs. Of significance is that, in the same period, the companies collectively spent in excess of US 40 billion in research and development (R D). This amount is more than 10% of their sales revenues, showing the importance of R D for these companies. 

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