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 earnigns before tax
• R is the total revenue generated (\$)
• OC is total cost of operations (\$)

## 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