Policy & Guidance

Worksheet I

Calculation of Profit Rates

With and Without Pollution Control Project Costs

A. Profit Rate Without Project Costs

PRT = EBT ÷ R

Where:	PRT	=	Profit Rate Before Taxes
	EBT	=	Earnings Before Taxes
	R	=	Reveneus

Three Most Recently Completed Fiscal Years

		19___		19 ___		19 ___
EBT [Worksheet H, (4)]		________		________		________		(1)
R [Worksheet H, (1)]		________		________		________		(2)
PRT = Calculate: [(1)/(2)]		________		________		________		(3)
Considerations: How have profit rates changed over the three years?
Is the most recent year typical of the three years? Yes No (If not, you might want to use an earlier year or years for the analysis) How do these profit rates compare with the profit rates for this line of business"? Please discuss below.

B. Profit Rate With Pollution Control Costs

PRPR = EWPR ÷ R

Where:	PRPR	=	Profit Rate With Pollution Control Costs
	EWPR	=	Before-Tax Earnings With Pollution Control Costs
	R	=	Reveneus

	The Most Recently Completed Fiscal Year
	19___
EWPR [Worksheet H, (7)]	$________  (4)
R [Worksheet H, (1)]	$________  (5)
PRPR [Calculate: (4)/(5)]	________ (6)

Considerations:

What is the percentage change in the profit rate due to pollution control costs ? Calculate as follows: (PRPR - PR)/PR x 100

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How does the profit rate with pollution control compare to the profit rate of this line of business?

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