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With reference to the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), consider the following statements:
1. It is a measure of profits.
2. It ignores the quality of a company's earnings and can make it look cheaper than it really is.
Which of the statements given above is/are correct?    
  • a)
    1 only        
  • b)
    2 only        
  • c)
    Both 1 and 2        
  • d)
    Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
With reference to the Earnings Before Interest, Taxes, Depreciation, a...
The State-owned undertakings Bharat Sanchar Nigam Ltd. (BSNL) and Mahanagar Telephone Nigam Ltd. (MTNL) have turned EBITDA positive in first 6 months of this financial year.
  • EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization.
  • It is a metric used to evaluate a company’s overall financial performance. EBITDA is a measure of profits.
  • EBITDA is now commonly used to compare companies' financial health and evaluate firms with different tax rates and depreciation policies.
  • Among its drawbacks, EBITDA is not a substitute for analysing a company's cash flow and can make a company look like it has more money to make interest payments than it really does.
  • EBITDA also ignores the quality of a company's earnings and can make it look cheaper than it really is.
     
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Community Answer
With reference to the Earnings Before Interest, Taxes, Depreciation, a...
The State-owned undertakings Bharat Sanchar Nigam Ltd. (BSNL) and Mahanagar Telephone Nigam Ltd. (MTNL) have turned EBITDA positive in first 6 months of this financial year.
  • EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization.
  • It is a metric used to evaluate a company’s overall financial performance. EBITDA is a measure of profits.
  • EBITDA is now commonly used to compare companies' financial health and evaluate firms with different tax rates and depreciation policies.
  • Among its drawbacks, EBITDA is not a substitute for analysing a company's cash flow and can make a company look like it has more money to make interest payments than it really does.
  • EBITDA also ignores the quality of a company's earnings and can make it look cheaper than it really is.
     
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With reference to the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), consider the following statements:1. It is a measure of profits.2. It ignores the quality of a companys earnings and can make it look cheaper than it really is.Which of the statements given above is/are correct? a)1 only b)2 only c)Both 1 and 2 d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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With reference to the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), consider the following statements:1. It is a measure of profits.2. It ignores the quality of a companys earnings and can make it look cheaper than it really is.Which of the statements given above is/are correct? a)1 only b)2 only c)Both 1 and 2 d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? for Current Affairs 2024 is part of Current Affairs preparation. The Question and answers have been prepared according to the Current Affairs exam syllabus. Information about With reference to the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), consider the following statements:1. It is a measure of profits.2. It ignores the quality of a companys earnings and can make it look cheaper than it really is.Which of the statements given above is/are correct? a)1 only b)2 only c)Both 1 and 2 d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for Current Affairs 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), consider the following statements:1. It is a measure of profits.2. It ignores the quality of a companys earnings and can make it look cheaper than it really is.Which of the statements given above is/are correct? a)1 only b)2 only c)Both 1 and 2 d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?.
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