During 2016 Wu Han Co. generated revenues of $95000. The company's expenses were as follows: cost of goods sold of $47000 operating expenses of $16000 and a loss on the sale of equipment of $5000. Wu Han's income from operations is
A) $37000.
B) $32000.
C) $48000.
D) $95000.

Question

Quizplus · Accepted Answer

Income from operations is calculated by deducting both cost of goods sold and operating expenses from revenues. 
Income from operations = Revenues - (Cost of goods sold + Operating expenses)
= $95000 - ($47000 + $16000)
= $32000