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Reporting entities use various descriptions for the categories of revenue presented on the face of the income statement. Such descriptions are based on facts and circumstances of each reporting entity and may include industry considerations. Some examples of these descriptions include:
  • Net revenues
  • Net sales
  • Product revenue
  • Service revenue
  • Software revenue
  • Hardware revenue
  • Subscription revenue
  • Advertising revenue

The revenue standard requires reporting entities to separately present or disclose revenue from contracts with customers from other sources of revenue. Other sources of revenue include, for example, revenue from interest, dividends, leases, etc. Interest income and interest expense recorded when a significant financing component exists (see RR 4.4) must be presented separately from revenue from contracts with customers in the statement of comprehensive income. A reporting entity might present interest income as revenue in circumstances in which interest income arises from a reporting entity’s ordinary activities.

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