How to use EBITDA Calculator
Given the financial information for Company XYZ:
- Operating Revenues = 1,500,000
- Operating Expenses = 800,000
- Depreciation = 50,000
- Amortization = 20,000
Answer:
First, we calculate EBIT:
EBIT = Operating Revenues – Operating Expenses EBIT = 1,500,000 – 800,000 EBIT = 700,000
Next, we calculate by adding back Depreciation and Amortization: EBITDA = EBIT + Depreciation + Amortization
= 700,000 + 50,000 + 20,000
= 770,000
XYZ generated 770,000 earnings from its core operations (before Interest, Tax, Depreciation , Amortization)
Reference (External Link): https://Corporatefinanceinstitute.com