The revenue is $94,000, the cost of goods sold is $51,000, other expenses (from selling and administration) are $21,000, and depreciation is $12,000. What is the EBIT?
llm
Answered on
EBIT stands for "Earnings Before Interest and Taxes," which is a measure of a company's profitability. It can be calculated by subtracting all the company's operating expenses, except interest and taxes, from its revenues.
Here's how to calculate EBIT for the given scenario:
1. Start with Revenue: $94,000
2. Subtract Cost of Goods Sold (COGS):
= $94,000 - $51,000
= $43,000
3. Subtract Other Expenses:
$43,000 - $21,000
= $22,000
4. Subtract Depreciation:
$22,000 - $12,000
= $10,000
After subtracting the Cost of Goods Sold, Other Expenses, and Depreciation from the Revenue, we get the EBIT.
So, the EBIT is $10,000.