1. Pre-tax profit of products = product sales revenue-product sales cost-sales tax after distribution and additional-period expenses after distribution.
2. earnings before interest and tax = net profit of the enterprise+interest expenses paid by the enterprise+income tax paid by the enterprise.
3. EBIT = marginal contribution-fixed operating cost = sales revenue-variable cost-fixed cost EBIT
Regardless of the operating profit of the enterprise, the debt interest of the enterprise and the dividend of the preferred stock are always fixed. Moreover, when the income before interest and tax increases, the fixed financial expenses borne by each yuan of income will be relatively reduced, which can bring more and better income to ordinary shareholders.
Extended data:
Earnings before interest and tax (ebit) generally refers to the profit without deducting interest or income tax, that is, the profit obtained by an enterprise without considering interest, which can also be called earnings before interest and tax. Among them, for industrial enterprises, total profit = sales profit+net investment income+non-operating income-non-operating expenditure; For commercial enterprises, total profit = operating profit+net investment income+summary profit and loss+non-operating income-non-operating expenditure+subsidy income.
References:
Baidu Encyclopedia-Pre-tax profit-pre-tax profit calculation