Enter the total revenue and total operating costs into the calculator to determine the earnings before tax (EBT).

EBT Formula

The following formula is used to calculate the earnings before tax: 

 EBT = R - OC
  • Where EBT is the earnings before tax
  • R is the total revenue generated ($)
  • OC is the total cost of operations ($)

To calculate the earnings before tax, subtract the total cost of operations from the total revenue.

EBT Definition

What is EBT?

EBT, short for earnings before tax (also commonly referred to as EBIT or earnings before interest and tax), is a term used in business to describe the total amount of profit made from a business before taxes are taken.

Example Problem

How to calculate EBT?

  1. First, determine the total revenue earned for the business.

    For this example, the total revenue is given as $50,000.00.

  2. Next, determine the total costs during the same time period.

    This is typically all operational and direct costs associated with the business. In this case, the costs were $30,000.00.

  3. Finally, calculate the EBT using the formula.

    Using the formula above, the EBT is calculated to be:
    EBT = R – OC
    EBT = $50,000 – $30,000
    EBT = $20,000