what is the difference between ebit ebt and ebitda 
working down the income statement provides a view of profitability with different types of expenses involved operating profit also known as ebit is a measure of a company s full operational capabilities this includes the direct cogs involved with manufacturing a product and the indirect operating expenses that are associated with the core business but not directly tied to it pbt is a part of the final steps in calculating net profit it deducts interest from ebit this arrives at the taxable net income for a company interest itself is often an indicator of a company s capitalization structure if a company has been financed with a high amount of debt it will have higher interest payments to make ebit is often the best measure of full operational capabilities while the differences in a company s ebit vs pbt will show its debt sensitivity earnings before interest tax depreciation and amortization ebitda is an extension of the well known usefulness of ebit as an operational profitability and efficiency measure ebitda adds the non cash activities of depreciation and amortization to ebit many analysts find ebitda is a very quick way to assess a company s cash flow and free cash flow without going through detailed calculations ebitda like ebit is before interest and tax so it is readily comparable many types of multiples comparisons will use ebitda because of its universal usefulness enterprise value to ebitda is one example 