EBITDA is very similar to EBIT. In simple words, this is the same as EBIT but expanded by amortization and depreciation. EBIT and DA – our depreciation and amortization. EBITDA equal to operating profit added depreciation expenses added to amortization Expenses.
EBITDA = operating profit + depreciation expense + amortization expense
let us consider,
- Earnings Before Interest, Taxes, Depreciation and Amortization.
- EBITDA is made to measure the operating profit.
- Interest, taxes and, as we have already written above, deprecation and amortization