FINANCIAL PROJECTIONS: TYPICAL P&L Revenue COGS – Costs of Goods Sold o Includes direct product costs: manufacturing, shipping, direct labor Operating Expenses o R&D, sales, marketing, corporate overhead, depreciation, amortization
EBITDA – Earnings before Interest, Tax, Depreciation and Amortization o Common term used by investors to gauge cash flow
EBIT – Earnings before Interest and Taxes o Also called Operating Profit 20
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Revenue
$
50.0 100%
Cost of Goods Sold Gross Margin
$ $
20.0 30.0
40% 60%
Sales & Marketing R&D G&A Operating Expenses
$ $ $ $
15.0 5.0 2.5 22.5
30% 10% 5% 45%
EBITDA
$
7.5
15%
Depreciation/Amortization $
3.0
6%
Operating Profit/EBIT
$
4.5
9%
Interest $ Taxes $
1.0 1.4
2% 3%
$
2.1
4%
Net Income