What is EBIT for

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EBIT is essential because it allows you to detect how much the company earns before the state keeps its share of the income, showing which places are best to work. And what is EBITDA? When you start studying accounting concepts, it is very likely that you will come across different acronyms that catch your attention, one very similar to EBIT: EBITDA. This refers to earnings before taxes, depreciation and amortization . If only taxes are deducted from EBIT, on this occasion depreciation, taxes and amortization expenses are subtracted. In this sense, we define depreciation as the cost of an asset during its useful life and are elements that can be touched and seen such as machinery, vehicles and real estate.


Sure, the company will benefit from them for a long time, but there Belarus WhatsApp Number will come a time when they will lose their market value due to wear and tear or because they have become obsolete. For its part, amortization is the method in which the value of an asset is distributed throughout its useful life . In most cases it is used for the process of extinguishing a debt through periodic payments as well as the loss of the right to use an object over time. Therefore, everything related to patents, copyrights, licenses and patents are linked to amortization to calculate EBITDA.  Well, as you will see, EBIT is a super relevant indicator that is constantly mentioned in the business world.



But what is it really for? Let's see what you can use it for in your daily life. Take note and don't let the numbers flood your head. Guide investments The first thing we can use EBIT is to guide investments, since it gives you the possibility as an investor to compare different companies to make the best decision. Here you will compare their accounting structures so you can choose which one has the greatest potential in the following years. This way, you will know which companies will have the highest profits and when they will obtain them.