EBITDA - Earning Before + Interest + Taxes + Depreciation + Amortization

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EBITDA
EBITDA

If you are working in stock market then several times you have heard about the term EBITDA wherever there is Quarterly results or Annually results announced by company. 

Full form of EBITDA - Earning Before + Interest + Taxes + Depreciation + Amortization. The full form its explains what is included in EBITDA. It is the profit of company before paying portion of Interest, Taxes, Depreciation and Amortization. EBITDA details founds in the Profit & Loss statement.

Earning - Amount generated by sales.

Interest - Amount paid in the form of monetary charge for loans taken.

Tax - Amount paid in the form of taxes levied by government.

Depreciation - Amount paid for the expensing of a fixed tangible assets over it useful life. Ex - Equipment, Vehicle, Land, Machinery & Building etc.

Amortization - Amount paid for the intangible assets over the asset's useful life. Ex - Patents, Trademarks, Franchise agreements, Proprietary processes (Copyrights) etc.


How to Calculate EBITDA?

EBITDA = Net Income + Interest + Tax + Depreciation + Amortization

EBITDA
EBITDA

Conclusion:

It's time to wrap up. So, EBITDA is now easily understandable to you as it is the profit of company  before paying of Interest, Taxes, Depreciation and Amortization.

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