Question

We can say that the business is in profit, when: 1) income exceeds liabilities 2) assets exceed expenditure 3) income exceeds liabilities 4) income exceeds expenditure

Answer 1

We can say that the business is in profit, when income exceeds expenditure.

Answer 2

We can see a business is in profit when income exceeds expenditure.

• Profit is one of the most important motivating factors for anyone to do business. It is also known as the blood of any business.
• A business organisation has various expenditures like production advertisement salaries and legal expenditures.
• The source of income for the organisation is the customers and they should be treated very nicely.
• When the income of a business exceeds all the expenditures it is said to be a profitable business.