when looking at a company s income statement from top to bottom operating expenses are the first costs displayed below revenue the company starts the preparation of its income statement with top line revenue cost of goods sold cogs is subtracted from revenue to arrive at gross income 
after gross income is calculated operating costs are subtracted to get the company s operating profit or earnings before interest and tax ebit after operating profit has been derived non operating expenses are subtracted from operating profit to arrive at earnings before taxes ebt taxes are then deducted to derive net income non operating expense examplesmost public companies finance their growth with a combination of debt and equity regardless of the allocation any business that has corporate debt also has monthly interest payments this is considered a non operating expense as interest payments don t arise as a result of a business operations but because of the financing of the operations if a company sells a building and it s not in the business of buying and selling real estate the sale of the building is a non operating activity if the building were sold at a loss the loss is considered a non operating expense frequently asked questions