Accounting profit can be calculated as

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Accounting profit is calculated as total revenue minus explicit costs, which includes all the actual expenses incurred by the company in the production process, such as wages, rent, utilities, materials, and other tangible expenses. Implicit costs, on the other hand, are the opportunity costs of using company resources for certain activities and are not included in accounting profit. Fixed costs are also not considered when calculating accounting profit.

Accounting Profit Can Be Calculated as