Question

Which of the following is not a component of other income? (1)
(a)Dividend Income
(b)Proceeds from sale of scrape
(c) Interest Income
(d) Gain on sale of Investment​

Answer 1

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D is the right answer.

Gain on sale of Investment.

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Answer 2

Answer:

The correct option is B i.e., Proceeds from sale of scrap

Explanation:

Revenue from operation or operating income refer to income which is earned by business or firm during its regular course of action or earned through its regular operation activity.

Operating income consists of Net Sales (Revenue from operation)  and Sale of Scraps goods.

If business earned any other income or gain (which is not related to  regular operation activity) are called as Other Income

Other Income consists of:

1. Gain on sale of Fixed assets

2. Rent received

3. Dividend Received (Only for Non-Financial Institution)

4. Interest received (Only for Non-Financial institution)

So, Proceeds from sale of scrap is not component of other income; If business is non-financial institution.

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