..| A firms annual income statement | A firms annual income statement |
|---|---|
| Revenue | $2,000,000 |
| Operating Expense | |
| Salaries | (1,000,000) |
| Rent | (500,000) |
| Amortization | (25,000) |
| Depreciation | (75,000) |
| Earnings Before Interest and Taxes (EBIT) | $400,000 |
| Interest Expense | (50,000) |
| Operating Income (Earnings Before Taxes, or EBT) | $350,000 |
| Taxes | (100,000) |
| Net Income | $250,000 |
According to the above formula:-