Calculate the economic and accounting profit in the given case
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Calculate the economic profit and accounting profit with the help of given information about XYZ company.
Total Revenue=$500,000
Wages and salaries=$400,000
Forgone salary=$80,000
Interest paid=$10,000
Forgone Rent=$10,000
Raw Material=$50,000
Other payments=$20,000
Forgone interest=$7,000
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Solution depicts the steps to estimate the economic profit and accounting profit in the given case.
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Total Revenue=$500000
Explicit cost include direct accounting costs. So,
Explicit cost=wages and salary cost+interest paid+raw ...
Education
- BEng (Hons) , Birla Institute of Technology and Science, India
- MSc (Hons) , Birla Institute of Technology and Science, India
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