Question

Interest expense would be classified on a multiple-step income statement under the heading a) Other revenues and gains. b) Operating expenses. c) Other expenses and losses. d) Cost of goods sold.

Answer 1

Answer is c

Explanation:

Interest expense has no relation with the companies' principal activities. Therefore, on a multiple-step income statement, besides the other expenses like lawsuit settlements, extraordinary losses from investments etc., interest expense is listed in the non-operating and other section.