Answer :
Final answer:
Peripheral or incidental transactions involve sales revenue, cost of goods sold, gain on the sale of equipment, and operating expenses.
Explanation:
Sales revenue (1), Cost of goods sold (2), Gain on the sale of equipment (3), and Operating expenses (4) are typically considered primary components of a company's income statement. However, gains on the sale of equipment (3) are often categorized as incidental or peripheral transactions because they arise from activities outside the company's primary operating activities. While sales revenue, cost of goods sold, and operating expenses are directly related to the core business operations, gains on the sale of equipment are usually considered non-operating income. It represents the profit generated from selling assets that are not part of the regular sales inventory. Therefore, among the options provided, gains on the sale of equipment (3) are more closely associated with peripheral or incidental transactions.
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