Which of the following is shown as a finance cost in the statement of profit or loss?
Answer and explanation
Correct answer: A. Interest payable on a bank loan
- Step 1: Finance costs are the costs of borrowing.
- Step 2: Interest on a loan is the cost of using borrowed money.
Answer
Interest payable on a bank loan.
Why not the others: Depreciation is an operating expense. Dividends are a distribution of profit shown in equity, not a finance cost. Wages are an operating expense.
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