Financial performance of the business

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Earnings before interest and taxes (EBIT) is one of the necessary starting point for financial analysis and financial performance of the business.

a. Given the above statement, explain why it is a correct statement (you need about 50 effective words for a valid response to this question)?

b. Assume a business has revenue of $70,000, total operating costs excluding depreciation, which means cost of goods sold is $50,620, depreciation is $5,620, and its interest expense on outstanding loans is $2,800.

i. What is the firm's EBIT after computation of the data given here?

ii. What is the businesses EBT (earnings before taxes).

Reference no: EM133068490

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