EBITDA: The Good, the Bad, and the Ugly

Topics:
Amortization,
Taxes
Tags:
Amortization,
Depreciation,
EBITDA
Source:
Investopedia

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Overview: EBITDA is one of those terms that is increasingly used, but usually for the wrong reason. This paper will define it and discuss how it can be useful, but also misleading. EBITDA is an acronym for "Earnings before interest, taxes, depreciation and amortization". It is calculated by taking operating income and adding back to it depreciation and amortization expenses. EBITDA is used to analyze a company's operating profitability before non-operating expenses (such as interest and "Other" non-core expenses) and non-cash charges (depreciation and amortization).

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Format: HTML | Date: Feb 2002 | Pages: 2


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