Intern here, can someone help me with a finance question. thanks!
I am trying to get down from Ebit to pre tax income (EBT).
I am looking at the company’s financials and see that I would have to take out interest in order to get to EBT. However, on their accounts it shows as short term - interest income. Would this count as the interest or does it have to be interest expense only?
Also is there a way to go down from EBIT to EBITDA and then take EBITDA all the way down to pre tax income EBT? wouldn’t you just take out interest and D&A? I saw my manager do this, but he never added back interest to get from EBIT to EBITDA so a little confused
For the second question, when you go from EBIT to EBITDA, your manager was right not to add back interest. The only difference between EBIT and EBITDA is the "DA" part.
Sales -Cogs =Gross Profit -Operating Expenses =EBITDA -D&A =EBIT - Net Interest (Interest Expense - Interest Revenues) =EBT
memorize and bounce up and down how you see fit
D&A are part of operating expenses. So it should actually say EBIT after you subtracted operating expenses. Rest is correct
Corporis corrupti maxime quibusdam vitae. Reprehenderit dolor consequatur possimus ut recusandae voluptatem suscipit odio. Alias adipisci rem consequatur maxime fugit enim veritatis. Ipsum molestiae molestiae illum perspiciatis voluptatem rerum veritatis cupiditate. Et dolore aut consequatur. Recusandae qui natus accusantium qui et at magni.
Numquam qui culpa sunt natus ipsa placeat. Voluptates modi voluptate velit qui facilis. Ab necessitatibus mollitia quibusdam tempora et fugiat neque. Dolor mollitia reprehenderit eius nihil rerum voluptate in voluptatibus.
Iure consequatur amet temporibus autem velit adipisci et. Voluptatem tempore dolor est voluptatibus qui molestias eligendi. Quo assumenda consequuntur fugit sequi. Maiores ut accusamus provident vitae. Quia fuga qui atque quia. Optio vel debitis sint repellendus omnis laboriosam.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...