Which one of the following is NOT included in the calculation of operating income?
A)sales
B)depreciation
C)interest expense
D)cost of goods sold
E)other operating expenses

Question

Quizplus · Accepted Answer

Operating income is calculated by subtracting operating expenses (such as cost of goods sold and other operating expenses) from revenues (such as sales). Depreciation is a non-operating expense, but it is still included in operating income because it reflects the wear and tear of a company's assets used in operations. However, interest expense is not included in the calculation of operating income because it reflects the cost of financing the company's operations rather than the cost of the operations themselves.

Which One of the Following Is NOT Included in the Calculation