Asked by
Eskander Kian Ben Aissa
on Oct 25, 2024Verified
Accounting profit takes into account explicit costs,but economic profit does not.
Accounting Profit
The financial gain calculated by subtracting total explicit costs from total revenue, representing the net income reported on a company's financial statements.
Explicit Costs
Direct, out-of-pocket payments for expenses incurred in conducting business, such as rent, salaries, and materials.
- Contrast explicit and implicit costs and comprehend their importance in the analysis of economic and accounting profits.
Verified Answer
CA
Learning Objectives
- Contrast explicit and implicit costs and comprehend their importance in the analysis of economic and accounting profits.