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Water: Economics

Policy & Guidance

Interim Economic Guidance for Water Quality Standards

Worksheet V

Calculation of Earnings Before Taxes

A. Earnings Without Pollution Control Project Costs

EBT = R - CGS - CO

B. Earnings With Pollution Control Project Costs

EWPR = EBT - ACPR

Where: EBT = Earnings Before Taxes
EWPR = Earnings with Pollution Project Costs
R = Revenues
CGS =

Cost of Goods Sold (including the cost of materials, direct labor, indirect labor, rent and heat)

CO =

Portion of Corporate Overhead Assigned to the Discharger (selling, general, administrative, interest, R&D expenses, and depreciation on common property)

ACPR =

Total Annual Costs of Pollution Control Project [Worksheet R (5)]

R $________ (1)
CGS $________ (2)
CO $________ (3)
EBT [ (1) - (2) -(3) ] $________ (4)
ACPR [ Worksheet R (5) ] $________ (5)
EWPR [ (4) - (5) ] $________ (6)

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