Which of these is NOT a component of NOPAT?

The definition of NOPAT, which stands for Net Operating Profit After Taxes, is crucial for understanding why debt is not a component of this metric. NOPAT is calculated by taking operating income and deducting taxes related to that income.

The calculation focuses specifically on the profits generated from operations without considering the effects of capital structure, which includes any form of debt or interest expenses. This is because NOPAT aims to provide a clearer picture of a company's operational efficiency and profitability stemming solely from its core business activities, disregarding how the company is financed.

Operating income reflects the earnings from operations before any interest and taxes, forming a basis for NOPAT when taxes are deducted. Therefore, while net operating profit, taxes, and operating income are integral parts of calculating NOPAT, debt plays no role in this process, emphasizing why it is the correct answer in this context.