FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Calculate EBITDA

I calculated $6,750,000 but I also calculated 6,507,692 - which one is correct?

Operating costs (excl. depreciations & amortization): $4.5m
Depreciation and amortization: $1.5m
Interest: $0.7m
Net Income: $2.8m
Tax Rate: 35%


Expert Solution
Check Mark
Step 1

Income before tax = Net income / (1 - tax rate)

= $2,800,000/(1-0.35)

= $4,307,692

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