Lauren is the owner of a bakery. Last year, her total revenue was $145,000, her rent was $12,000, her labor costs were $65,000, and her overhead expenses were $15,000. From this information, we know that her accounting profit was:

Question

Quizplus · Accepted Answer

Accounting profit is calculated by subtracting all explicit costs (such as rent, labor costs, and overhead expenses) from total revenue. Therefore, Lauren's accounting profit would be:

$145,000 (total revenue) - $12,000 (rent) - $65,000 (labor costs) - $15,000 (overhead expenses) = $53,000.

Therefore, the correct answer is B.

Lauren Is the Owner of a Bakery