While calculating _______, the incomes and expenses of a purely financial nature are not taken into account.

Net profit

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Operating profit

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Net loss

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Operating loss

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Solution

The correct option is C Operating profit
Operating profit is the excess of operating revenue over operating expenses. While calculating operating profit, the incomes and expenses of purely financial nature are not taken into account. Thus, operating profit is profit before interest and tax (EBIT).

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Similar questions

Q. While calculating Operating profit the incomes and expenses of purely ____________ nature are not taken into account.

Q. Outstanding and prepaid expenses and incomes are taken into account in determining profit or loss under _________________.

Q. Accounts which record expenses, losses, incomes and gains of the business are known as ______________.

Q. Accounts relating to income, revenue, gain expenses and losses are termed as ______________.

State whether the following statement are true or false.

1. Final Accounts are prepared on the basis of Trial Balance.
2. Trading Account is a part of Profit & Loss Account.
3. Profit Loss Account is prepared to find out Gross Profit or Gross Loss.
4. Gross Profit or Gross Loss is transferred to Balance Sheet.
5. An amount of net profit is added to the capital.
6. All indirect expenses are debited to trading account.
7. Balance Sheet is a statement and not an account.
8. Capital account is a personal account.
9. Amount of prepaid expenses appears on assets side.
10. Bank Overdraft is a liability of business concern.

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While calculating _______, the incomes and expenses of a purely financial nature are not taken into account.

The correct option is C Operating profitOperating profit is the excess of operating revenue over operating expenses. While calculating operating profit, the incomes and expenses of purely financial nature are not taken into account. Thus, operating profit is profit before interest and tax (EBIT).

The correct option is C Operating profit
Operating profit is the excess of operating revenue over operating expenses. While calculating operating profit, the incomes and expenses of purely financial nature are not taken into account. Thus, operating profit is profit before interest and tax (EBIT).