When a business's expenses are more than its revenues.

• A. Loss
• B. Goods
• C. Labour
• D. Suppliers

Answer: (A)

When expenses exceed revenues, a business experiences a loss. Revenues are the money earned from selling goods or services, while expenses are the costs to operate—things like materials, wages, rent, and utilities. If the costs are greater than the income, the net result is negative, which is called a loss. This reduces the business’s equity and can affect cash flow.

The other terms describe parts of the business rather than the financial outcome: goods are the items you sell or hold in inventory, labour is one type of expense, and suppliers are the vendors you pay for inputs. None of these by themselves describe what happens to the bottom line when expenses outpace revenues.