For #13, capital =total asset=total debt + total shareholder’s equity For #14, capitalization= long term debt +equity Is there any difference between capital and capitalization? Also for #14, operating income=Sales – COGS – SG&A expense – R&D expense. Shouldn’t it be operating income=EBIT? Thanks!
Usually capital is calculated at LTD + equity, or NWC+NPPE… And yes, operating income = EBIT less one time charges or impairments
jonly, as westibbs pointed out EBIT does not equal operating income. ebit is below operating income on the IS and includes non-operating items. operating income = revenue less expenses (sga, depr, amort, cogs) ebit = operating income +/- extraordinary items/non-operating items (i.e. gain/loss asset disposal) They test this time and time again.
Chuckrox8 Wrote: ------------------------------------------------------- > jonly, > > as westibbs pointed out EBIT does not equal > operating income. ebit is below operating income > on the IS and includes non-operating items. > > operating income = revenue less expenses (sga, > depr, amort, cogs) > > ebit = operating income +/- extraordinary > items/non-operating items (i.e. gain/loss asset > disposal) > > They test this time and time again. I don’t understand the distinction you are making here? Could you point me to a page # that clears this up? My understanding is: Revenue -COGS =Gross Profit -SG&A =Operating income before Depreciation -Depreciation =Operating Income after depreciation (EBIT) -Interest +/- special items and nonoperating items =EBT -Taxes =Income from continuing operations +/- one time gains and losses =Net Income Income from continuing ops is different from operating income
Chuckrox8 Wrote: ------------------------------------------------------- > jonly, > > as westibbs pointed out EBIT does not equal > operating income. ebit is below operating income > on the IS and includes non-operating items. > > operating income = revenue less expenses (sga, > depr, amort, cogs) > > ebit = operating income +/- extraordinary > items/non-operating items (i.e. gain/loss asset > disposal) > > They test this time and time again. But still, the answer didn’t subtract depreciation to get operating income! The extraordinary items/ non-operating items are income from discontinuing operation, as ftwcfa mentioned