Are the profits exclusive of taxes?

Before Interest and Taxes.

And then they'll say well in the most naive interpretation of things, you net income in theory should be the cash you're getting or at least it's some type of profit you're getting assets in the door or at least you're counting as if you're getting some assets in the door.

Interest on loans is high at present.

The loan bears an 8 interest.

So this little thing that I just created here, this little reconciliation between the positive 200 in income and the negative 200 of cash, it's showing how we got from this starting point in cash to this ending point.

And at least it'll give you a sense of how revenues, gross profit, operating profit, pre tax income and net income really are different.

So this is a source of cash, so now the cash from operations 200 net income 400 100

Minus 500,000.

This is what the owners of the company get before they pay the government.

(Laughter) But I know it's the bottom line, or one's perception of it, that motivates people in the end.

But here you see it means very, very different things.

This is really important to pay attention to, because so many people say, oh, a company made this much.

I'll just abbreviate that as Nl.

Go ahead, eat.

And when people talk about earnings of a company, this is what they're talking about.

Our interests clash with theirs.

So this is lending some cash.

And so you can already imagine that both EBlT and the way I defined it initially, operating profit divided by assets.

You get 400 from the customer the previous month.

And you could guess what the next line is going to be, given that this says pre tax.

(Laughter)

So in any of these periods, the depreciation expense should be added back to the operating profit, to figure out the cash from operations.

Money lenders are enjoying a profitable period.

If this technology is widely adopted,

Kill the goose that lays the golden eggs.

Maybe it was 4 , or 3.5 .

The taxes will be 153,000.

I'm not a charity commissioner.

A benefit to both our worlds.

We are assuming a very simple world, were the is no taxes, we have no debt, we have no intrest or things

So you've probably heard not only the term earnings, you've probably also heard the term earnings per share.

They buy more of your service and they tell more of their friends, which leads to more profit.

I guess you could say non cash assets, right?

So that's a nice thing to keep in the back of your mind, this return on asset concept, and it's very closely tied to operating profits and the actual assets of a firm.

And that's what these brands did.

FDlC insured.

And that's my dad found that.

The rewards would be... enormous.

And let's say, assume if I inherited this million dollars, I didn't finance it.

And the way that you account for this 200 in advance from a customer, is you call that deferred revenue.

The reason this is happening boils down, in my mind, to one basic problem, which is our inability to perceive the difference between public benefits and private profits.

This is 350,000 of net income.

This was interest. This was non op income.

This guy makes what is this?