When does loss occur?
Answer and explanation
Correct answer: When expenses are more than income
Loss occurs when the total expenses of a business are greater than its income or revenue for the relevant period. In accounting terms, Loss = Expenses − Income when expenses are higher. Income exceeding expenses produces profit, while satisfied customers or a successful plan do not alone determine the accounting result.
Frequently asked questions
What is the correct answer to this question?
When expenses are more than income
Why is this the correct answer?
Loss occurs when the total expenses of a business are greater than its income or revenue for the relevant period. In accounting terms, Loss = Expenses − Income when expenses are higher. Income exceeding expenses produces profit, while satisfied customers or a successful plan do not alone determine the accounting result.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: Business, Trade and Commerce. Topic: Business Risk.
