All categories

3 years ago

Accounting profits are typically

Business

1 answer:

vodomira [7]3 years ago

5 0

Answer:

d. greater than economic profits because the former do not take implicit costs into account.

Explanation:

Accounting profit is total revenue less total cost or explicit cost.

Explicit cost are costs that is actually incurred. They appear in the financial statements of a company.

Economic profit is accounting profit less implicit cost.

Implicit cost is also known as opportunity cost. It is the cost of the activity forgone in order to carry out another activity. For example, if I earn $100 working as a teaching assistant but resign to start my own business as a fashion designer where I earn $500, my opportunity cost is $100.

Accounting profit is usually greater than economic profit because it doesn't take into account implicit cost. Accounting profit can be equal to economic profit if implicit cost is zero.

I hope my answer helps you.

You might be interested in

Myers Corporation has the following data related to direct materials costs for November: actual costs for 5,000 pounds of materi

Anastasy [175]

Answer:

A. $1,020 unfavorable.

3 0

3 years ago

Read 2 more answers

Sarah is a 50 percent partner in the SF Partnership and has an outside basis of $56,000 at the end of the year prior to any dist

Vikentia [17]

Answer:

A. $0 gain, $36,000 basis

Explanation:

In the distribution, from the information given, Sarah does not recognize any gain or loss.

However, given that

She had $56000 basis at end of year prior to distribution.

Then receives $20000 from distribution after reallocating her basis in SF to cash in amount equal to distribution

Therefore,

Her basis left = 56000 - 20000

= $36000

3 0

3 years ago

Read 2 more answers

The Federal Reserve purchases $8 million in U.S. Treasury bonds from a bond dealer, and the dealer's bank credits the dealer

Zinaida [17]

Answer:

The bank will be able to lend:

$42,105,263 ($8 million/ 0.19)

Explanation:

The above amount which the bank can lend from the $8 million received from the Federal Reserve for a customer is a function of $8 million deposit in a customer's account and the reserve ratio. This is called the money multiplier.

The money multiplier is the amount of money that banks generate with each dollar of reserves. Reserves is the amount of deposits that the Federal Reserve requires banks to hold and not lend. The level of Reserves and deposit liabilities determine the amount a bank can lend out.

The process by which banks create more money than the physical money is called money creation. This shows that a bank creates more money in the economy through its lending activities.

6 0

3 years ago

Problem 2 (9 points) The following information was taken from the income statement and balance sheet of The Perryman Company for

Len [333]

Answer and Explanation:

The computation is shown below;

The net profit margin is

= Net income ÷ sales revenue

= $184,000 ÷ $574,000

= 32%

The asset turnover is

= Sales revenue ÷ average of assets

= $574,000 ÷ ($2,142,000 + $1,998,000) ÷ 2

= $574,000 ÷ $2,070,000

= 0.28 times

c. The return on assets is

= Net income ÷ average of assets

= $184,000 ÷ $2,070,000

= 0.089

= 8.89%

3 0

3 years ago

One of your classmates was recently found to have cheated on the exam. Though furious, your instructor spoke to the student very

fiasKO [112]

Answer:

d. interpersonal justice

Explanation:

Interpersonal justice -

It refers to the practice of treating the people with proper respect and dignity , is referred to as interpersonal justice .

In case of any harmful , serious condition or activity , the practice of communicating or resolving the issue with the people in a very kind and respectful manner , is the sign of an intelligent or smart person .

Hence , from the given scenario of the question ,

The correct option is d. interpersonal justice .

4 0

3 years ago