Net interest and Net operating profit after tax: Difference between pages

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1.  
(NOPAT). A measure of business profitability which is independent of the chosen capital structure, but which does take account of the taxation of the operating profits.


''Tax.''
Often estimated as:
 
NOPAT = PBIT x (1-T)
Interest stated after offsetting tax effects, if any.
 
In this sense, ''net interest receivable'' means interest receivable stated after deducting any tax payable thereon.
 
In this context, ''net interest payable'' means interest payable stated after offsetting any tax relief enjoyed on the interest expense.
 
 
2.
 
Interest (usually) payable, stated after deducting other offsetting interest (usually) receivable in the same period.


where:
PBIT = profit before interest and tax; and
T = corporation tax rate.


== See also ==
== See also ==
* [[Gross interest]]
* [[Profit before interest and tax]]


[[Category:Accounting,_tax_and_regulation]]

Revision as of 14:20, 23 October 2012

(NOPAT). A measure of business profitability which is independent of the chosen capital structure, but which does take account of the taxation of the operating profits.

Often estimated as: 

NOPAT = PBIT x (1-T)

where: 

PBIT = profit before interest and tax; and
T = corporation tax rate.

See also


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