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EBITDA

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA APM Exams › EBITDA

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by AvatarKen Garrett.
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  • December 23, 2021 at 6:41 am #644718
    Avatarzkaay
    Participant

    Hi tutor,

    plz i have few questions regarding EBITDA which I would really appreciate your clarifications.

    i know that we take the figure before deducting interest expense.
    1- but what about interest income (what to do with it plz)?

    2- whats the difference between adjusted EBITDA and the normal EBITDA ?

    3- for calculating EBITDA or
    EBIT ( operating profit)

    -gain on disposal of nca
    -impairment loss
    – provisions (for end of service / doubtful debt/ inventory obsolence)

    those 3 items are they classified as ((operating expense )) and must deducted from revenue to arrive to EBIT or are they ((non operating expenses )) and must not been included in this performance measure?

    4- i believe the term non operating expense is different than non recurring expense (extra ordinary expense)
    but both must not been involved in EBIT or EBITDA Calculation plz advise

    Many thanks

    December 23, 2021 at 6:58 pm #644747
    AvatarKen Garrett
    Keymaster

    Sorry, but the only formula I know is:

    EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization

    Most of what you ask is really to do with financial reporting and APM is very unlikely to raise any of these complications.

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