The net interest deduction drops to 30 percent of EBIT.
EBIT, or earnings before interest and taxes, is a term widely used to assess a company's operational performance. EBIT stands for earnings before interest and taxation. Although they were not produced through the company's primary commercial operations, these costs are actual financial outlays. Operational costs, which include overhead expenditures for items like rent, marketing, insurance, corporate salaries, and equipment, are subtracted from gross profit to determine earnings before interest and taxes. An organization's EBIT is equal to its operating profit in the absence of non-operating income. Businesses can use this information to determine how profitable their operations are.
Note that the full question is:
According to the Tax Cuts and Jobs Act of 2017, after 2021, the net interest deduction drops to what percent of EBIT?
a. 30
b. 0
c. 50
d. 100
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