How to Determine EBITDA?

Start with net income

Add interest expense

Add taxes

Add depreciation expense

Add amortization expense

Use the formula: EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization

Alternatively, start with operating income

Add depreciation expense

Add amortization expense

Use the formula: EBITDA = Operating Income + Depreciation + Amortization

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