# Earnings Before Interest and Taxes

In finance, earnings before interest and taxes, is a measure of an company’s benefit that precludes interest and income tax expenses. EBIT is the difference between working incomes and working liabilities.

### Calculator of Earnings Before Interest and Taxes

### Formula of Earnings Before Interest and Taxes

**EBIT = R – E**

**Where,**

- R = Sales Revenue
- E = Operating Expenses

### Example of Earnings Before Interest and Taxes

A company has sales of $500000 with operating costs of $400000. Calculate the Earnings Before Interest and Taxes (EBIT).

**Given**

Sales Revenue (R) = $500000 Operating Expenses (E) = $400000

**To Find **

Earnings Before Interest and Taxes

**Solution**

EBIT = R – E = $500000 – $400000 = $100000

people found this article helpful. What about you?