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    Question

    In finance and corporate accounting, there exists a pivotal metric denoted as EBIT, it's often noted that EBIT bears a striking resemblance to which of the following financial indicators?" 

    A Gross Profit Correct Answer Incorrect Answer
    B Earnings before taxes Correct Answer Incorrect Answer
    C Net income Correct Answer Incorrect Answer
    D Operating profit Correct Answer Incorrect Answer
    E EBITDA Correct Answer Incorrect Answer

    Solution

    EBIT means Earnings before Interest and tax. It usually refers to the operating profit of the company as it is arrived at by reducing the net sales by cost of goods sold (COGS) and operating costs.

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