#### Cost of revenue

Cost of revenue is the amount of
money the business has to shell out in order to create their total revenue. For
instance you found an unattended cassette player and sold it to whoever still
wants one these days and received $10 from the sale. Your total revenue is $10,
and the cost of revenue is 0 since you just found it lying somewhere and sold
it, which didn't cost you anything to generate that $10, it's a freebie. In
a real business, companies spend to produce their own products, the total cost
to create the quantity of all their products is the cost of revenue. For example,
the company produced 10 cars and it costs $100,000 to make. When all the cars
were sold, they generated a revenue of $150,000. Therefore, the cost of a $150,000
revenue is $100,000.