50400 was paid to purchase automobiles The automobiles were

$50,400 was paid to purchase automobiles. The automobiles were purchased on January 1, 2014, and have four-year useful lives, with no expected salvage value. Lang uses straight-line depreciation. The revenue was generated by leasing the automobiles

What is the sales revenue?

Solution

$50,400 is a period cost which will reduce sales revenue. It should be treated as operating expense.

Net (Loss)/ Income =Sales revenue - operating expense = ($50,400)