Series 79 practice questioneasyFinancial due diligence – EBITDA adjustments
In financial due diligence, normalizing EBITDA typically requires making adjustments for which of the following?
- ANon-recurring and one-time charges✓ Correct answer
- BInterest expenses
- CDepreciation expenses
- DIncome tax expenses
Explanation
Why A — Non-recurring and one-time charges
Normalized EBITDA excludes one-time or non-recurring charges to better reflect ongoing operating performance. Interest, depreciation, and taxes are already excluded from EBITDA by definition.
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