Which one of the following expense categories is subtracted from total revenues to help arrive at a firm's EBIT?
A) Cash dividends
B) Depreciation expense
C) Interest expense
D) Tax liability

Question

Quizplus · Accepted Answer

Depreciation is a non-cash expense that reduces the value of an asset over its useful life. It is subtracted from total revenues to calculate earnings before interest and taxes (EBIT). The other options (cash dividends, interest expense, tax liability) are all cash expenses that are subtracted from EBIT to arrive at net income.

Which One of the Following Expense Categories Is Subtracted from Total