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    Question

    For a non-financial firm, are depreciation expenses and interest expenses included or not included from operating expenses in the income statement?

    Depreciation                    interest

    1.        included                     included
    2.       included                     not included
    3.         not included               included
    4.        not included               not included
    5.        none

    A Only 1 Correct Answer Incorrect Answer
    B Only 2 Correct Answer Incorrect Answer
    C Only 3 Correct Answer Incorrect Answer
    D Only 4 Correct Answer Incorrect Answer
    E Only 5 Correct Answer Incorrect Answer

    Solution

    Depreciation is an operating expense but interest expense is a financing cost so will be included in non-operating expense

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