Series 79 practice questioneasyIncome Statement Components
Which of the following is NOT subtracted from revenue to reach operating income (EBIT)?
- ACost of goods sold
- BSelling, general, and administrative expenses
- CDepreciation and amortization
- DInterest expense✓ Correct answer
Explanation
Why D — Interest expense
Interest expense is deducted after operating income is calculated; it is not part of the operating calculation. The other expenses are part of the EBIT calculation.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 995+ Series 79 questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Collection, Analysis & Evaluation of Data questions
- Which ratio would an investment banker most likely use to measure a company’s ability to cover its interest payments?
- If a company records depreciation expense in its income statement, what is the initial impact on cash flow from…
- Which of the following statements is correct regarding the relationship between the income statement and the balance…
- Which of the following is classified as an intangible asset on the balance sheet?
- A company reports net income of $100 million, interest expense of $20 million, taxes of $30 million, depreciation of…
- A company’s current ratio is calculated as:
- Given the following balance sheet data: Current Assets = $250 million, Current Liabilities = $200 million, what is the…
- Which section of the cash flow statement would typically include cash paid for inventory purchases?