What is the formula of operating?

What is the formula of operating?

Operating income is calculated by taking a company’s revenue, then subtracting the cost of goods sold and operating expenses. This is the formula: Operating Income = Revenue – Cost of Goods Sold – Operating Expenses.

What are included in the operating expenses?

Common operating expenses for a company include rent, payroll, travel, utilities, insurance, maintenance and repairs, property taxes, office supplies, depreciation and advertising.

What are operating expenses on income statement?

An operating expense is an expense a business incurs through its normal business operations. Often abbreviated as OPEX, operating expenses include rent, equipment, inventory costs, marketing, payroll, insurance, step costs, and funds allocated for research and development.

Is depreciation an operating expense?

Depreciation expense is reported on the income statement as any other normal business expense. If the asset is used for production, the expense is listed in the operating expenses area of the income statement. This amount reflects a portion of the acquisition cost of the asset for production purposes.