Tenax Therapeutics' (TENX) CEO John Kelley on Q3 2015 Results-Earnings Call Transcript.
Debit the cost of the asset and credit the loan account with the capitalized interest. In the example, debit the asset cost and credit the loan account with $50,000. The asset cost available for depreciation at the end of Year One is therefore $1,050,000. Debit the interest expense account and credit the loan account with any interest paid in excess of the interest capitalized. For example, if the total interest paid in the first year was $75,000, debit the interest expense account and credit the loan account with $75,000 minus $50,000, or $25,000.
EBITDA stands for Earnings before Interest, Taxes, Depreciation & Amortization expense. EBITDA is a tool to measure the value of a firm based on its net earnings before non-cash expenses (depreciation & amortization) are recorded, as well as dilutive expenses such as interest expense & taxes.