Explanation of Interest Expense:
Also called Interest Income and listed on the Income Statement, the Interest
Expense contains all income and costs other than the income and costs of
operations. Depending on the company's reporting convention, they may
call this figure Interest Expense, or Interest Income if the figure is
typically positive.
Importance of Interest Expense:
If the company is selling major assets like land, buildings, and other one-time
sales, the Interest Expense figure might be exceptionally higher on the
financial statement. Large investments, such as stakes in other companies
might be listed here, and it is here that you need to watch the investments of
the company. They will usually describe in detail these investments in
the "Accompanying Notes" section of the financial statement.
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