As Seen on the Income Statement of a Tax-Paying Firm

As seen on the income statement of a tax-paying firm:

A) interest is deducted from income and increases the total taxes incurred.
B) the tax rate is applied to the earnings before interest and taxes when the firm pays interest.
C) depreciation is shown as an expense but does not affect the tax expense.
D) depreciation reduces both the pretax income and the net income.
E) interest expense is added to earnings before interest and taxes to compute pretax income.