What is Service Revenue?

Service revenue is the sales reported by a business that relate to services provided to its customers. This revenue has usually already been billed, but it may be recognized even if unbilled, as long as the revenue has been earned. Service revenue does not include any income from the shipment of goods, nor does it include any interest income.

Presentation of Service Revenue

Service revenue may be presented in a separate line item, which appears near the top of the income statement. Alternatively, if the number is relatively small, it may be aggregated with product revenue and presented as a single number. If there are sales allowances associated with service revenue, the allowances may be paired with and offset the service revenue, or they may be combined in the income statement presentation.