Donnie's Donuts incurs $450,000 per year in explicit costs and $200,000 in implicit costs.The bakery earns $800,000 in revenues and has $2 million in net worth.Based on this information, what is the accounting profit for Donnie's Donuts?

Question

Quizplus · Accepted Answer

Accounting profit is calculated by subtracting explicit costs from total revenues. Therefore, $800,000 (revenues) - $450,000 (explicit costs) = $350,000.

Donnie's Donuts Incurs $450,000 Per Year in Explicit Costs and $200,000