How should companies with more than one revenue source report revenue and cost of goods sold?
A)Each revenue source should be reported separately, but all cost of goods sold should be added together and reported as a single amount.
B)The revenues and cost of goods sold should be netted together and reported as a single line item.
C)All revenue sources should be added together and shown as one line item and all cost of goods sold should be added together and shown as one line item.
D)Each revenue line should be shown separately with a corresponding cost of goods sold line for each revenue source.

Question

Quizplus · Accepted Answer

It is important to provide transparency and clarity in financial reporting, especially for companies with multiple revenue sources. Each revenue line should be reported separately along with its corresponding cost of goods sold line to provide a clear understanding of the company's sources of revenue and associated costs. This approach also facilitates analysis and decision-making by stakeholders such as investors, creditors, and management.

How Should Companies with More Than One Revenue Source Report