ExpressJet Income Statement

This is a conventional US Generally Accepted Accounting Principle (GAAP) income statement.  Like most income statements the first line contains the operating revenue which generally is number of flight tickets sold time weighted average price as well as the other services that XJT provides.

            XJT’s income statement itemizes its operating expense into separate lines. There is no line called “cost of goods” because they are providing services and not selling goods. The costs are therefore related to the costs of flying and maintaining the planes (this includes depreciation). The net difference between the operating revenue and the sum of the operating expenses are termed as operating income, labeled as gross profit in many other income statements.

            Following operating profits, most income statements move on to non operating profits/costs. This includes the net difference between interest income and expense, capitalized interest and equity investment loss. Equity investment loss refers to loss in market value from portfolio of security and real estate investments not related to the companies operations. The net difference between operating income and non operating income is earnings before interest and tax otherwise known as EBIT. After subtracting tax we arrive at net income. XJT has provides basic earnings per share and diluted earnings per share. The diluted earnings per share is derived by assuming that the 137’200’000 convertible bonds outstanding are convertible to 54.9451 shares per 1000 convertible bonds and adding this value to the current shares outstanding.