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What is EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization)
Earnings before Interest, Taxes, Depreciation and Amortization is a term that refers to EBIT (Earnings before Interest and Taxes) plus depreciation. Depreciation represents depreciation of long-term tangible assets and amortization of long-term intangible assets.

Earnings before Interest, Taxes, Depreciation and Amortization, abbreviated as EBITDA. It is a term that refers to EBIT plus depreciation. Depreciation represents depreciation of long-term tangible assets and amortization of long-term intangible assets. (US accounting system distinguishes different types of depreciation.)

Calculation: EBITDA = EBIT + depreciation

Use of EBITDA in practice: in business it is used by CFO in financial analysis to analyze ratios.

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Last update: 20.02.2017

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