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Finance Formulas / July 18, 2018 / Chanel Cleveland

EBITDA is a non-GAAP financial figure that measures a company's profitability before deductions that are considered somewhat superfluous to the business decision-making process. These deductions are interest, taxes, depreciation and amortization, all of which are not part of a company's operating costs and are therefore not associated with the maintenance and administration of a business on a day-to-day basis.

Annual percentage rate (APR) is the annualized interest rate on a loan or investment which doesn’t account for the effect of compounding. It is the annualized form of the periodic rate which when applied to a loan or investment balance gives the interest expense or income for the period. In most cases it is the interest rate quoted by banks and other financial intermediaries on various products i.e. loans, mortgages, credit cards, deposits, etc. It is also called the nominal annual interest rate or simple interest rate.

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