From the course: A Guide to Understanding Financial Statements

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Other income and other expenses

Other income and other expenses

From the course: A Guide to Understanding Financial Statements

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Other income and other expenses

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- [Narrator] And now we get to the last section of a profit and loss, other income and other expenses. These represent income and expenses from amounts that are earned or consumed that don't relate to your core business. So they aren't a cost of goods sold. You don't need this actual expense in order to deliver your revenue, and they aren't an operating expense. You don't need this expense to operate your business. Instead, they are an other income or other expense account. You may be scratching your head and wondering, "Well, what are some examples of other income and other expense accounts?" Let's go through that right now, starting with our other income accounts. We may have a gain on an asset that we hold and eventually sell for a higher price. We'll talk about what assets are shortly. But an easier example involves interest income. If you, for example, lend money to another institution, but your primary business model has nothing to do with lending, well, then the interest that…

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