Which One of the Following Statements Is Correct

Multiple Choice

Which one of the following statements is correct?

A) Pretax income is equal to gross profit minus interest expense.
B) Gross profit is equal to sales minus costs of goods sold and depreciation.
C) Operating expenses are indirect costs.
D) Costs that vary directly with production are classified as operating expenses.
E) The change in retained earnings is equal to net income plus dividends paid.