The Profit before tax
Getting to Know the P&L Statement: The Profit before tax
It's the amount of money left over after running costs are subtracted from operating income, but before taxes and interest are subtracted.
Profit before Tax = Total Revenues – Total Operating Expenses
The PBT is an important part of a Profit and Loss (P&L) statement because it shows how profitable the company was before taxes. It gives information about how well and efficiently the business is running without taking into account its tax responsibilities.
When you figure out the PBT, you take away the income tax costs to get the net profit after tax (NPAT). This is the company's total profit number that shareholders can see after all costs, including taxes, have been taken into account.
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Table of Contents: Getting to Know the P&L Statement 1. Introduction of the financial statements 2. The Profit and Loss statement |
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