Behrend Corporation has annual sales of $4.5 million, depreciation of $425,000, operating expenses of $679,000, cost of goods sold of $2.3 million, and interest expense of $230,000. What is the operating income?

Question

Quizplus · Accepted Answer

Operating income is calculated as Sales - Cost of Goods Sold (COGS) - Operating Expenses - Depreciation. Therefore, $4.5 million - $2.3 million - $679,000 - $425,000 = $1,096,000. Interest expense is not subtracted in the calculation of operating income.

Behrend Corporation Has Annual Sales of $4