When preparing a pre-LBO model, the historical income statement is completed until what point? A. Net income B. Interest expenses C. EBIT D. Operating expenses
Question
Solution 1
The historical income statement in a pre-LBO (Leveraged Buyout) model is typically completed until EBIT (Earnings Before Interest and Taxes). So, the correct answer is C. EBIT.
Here's why:
Start with revenue: The top of the income statement starts with total revenue or sales.
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