Operated Department Income (Rooms)
Operated Department Income (Rooms)=Net Income+Taxes+Non-Operating Expenses+Undistributed Operating Expenses-Operated Departments Income (Excluding Rooms)
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The amount of profit realized from a business's operations after taking out operating expenses - such as cost of goods sold (COGS) or wages - and depreciation. Operating income takes the gross income (revenue minus COGS) and subtracts other operating expenses and then removes depreciation. These operating expenses are costs which are incurred from operating activities and include things such as office supplies and heat and power. Operating Income is typically a synonym for earnings before interest and taxes (EBIT) and is also commonly referred to as "operating profit" or "recurring profit."
Resource:
- Dopson, Lea R., and David K. Hayes. Managerial Accounting for the Hospitality Industry. Hoboken, NJ: Wiley, 2009. Print.
- "Operating Income Definition | Investopedia." Investopedia. N.p., 24 Nov. 2003. Web. 07 Aug. 2015.
