Homework Answers
Answer
The correct answer is (B) $11500
Economic Profit = Accounting Profit - Implicit Cost.
Implicit Cost can be the income you sacrificed because of starting a new Business, Interest or Return You foregone because of investing in the business.
Here, income you sacrificed because of starting a new Business = $25000 and
Interest or Return You foregone because of investing in the business = 5% of 70,000 = $3500
Hence Implicit Cost = 25000 + 3500 = $28500
It is also given that Accounting Profit = $40000
Hence,
Economic Profit = 40000 - 28500 = $11500
Hence, the correct answer is (B) $11500
Add Answer to:
Suppose that you open your own business and eam an accounting proft of $40.00 pr year...
Suppose that you open your own business and eam an accounting profit of $35,000 per year....
Suppose that you open your own business and eam an accounting profit of $35,000 per year. When you started your business, you left a job that paid you a $30,000 salary annualy. Also, suppose that you invested $70,000 of your own funds to start up your business. If the normal rate of return on capital is 10 percent, your economic profit is O A, -$5,000. O B. $5,000. C.-$2,000 D. $2,000
4. Suppose that last year you started your own brewery. You had $90,000 in explicit costs, which included the wages you...
4. Suppose that last year you started your own brewery. You had $90,000 in explicit costs, which included the wages you paid your employees and the costs associated with the purchase of the ingredients that went into making your beer. You also incurred $61,000 in implicit costs, which included the $50,000 salary ou were earning before you left your previous job to start the brewery business. Over the course of the year, you sold 20,000 bottles of beer at an...
You quit your job that pays $60,000 in order to open your own business. If your...
You quit your job that pays $60,000 in order to open your own business. If your total revenue is $80,000, rent is $10,000, and supplies are $20,000, how much is your economic profit? Select one: O a. $10,000 O b. $10,000 O c. $20,000 O d. $30,000 Next pa # Perfect Competition in the Short Ru Jump to... wers
2. Suppose your friend was earning 22,000 a year as a sales representative for a T-shirt...
2. Suppose your friend was earning 22,000 a year as a sales representative for a T-shirt manufacturer. At some point she decided to open a retail store of her own to sell T-shirts. She invested 20,000 of savings that have been earning her $1,000 per year. And she decided that her new firm will occupy a small store that she owned and had been renting out for $5,000 per year. She hired one clerk to help her in the store,...
1. [Bank Loan Considerations] Assume you started a new business last year with $50,000 of your...
1. [Bank Loan Considerations] Assume you started a new business last year with $50,000 of your own money, which was used to purchase equipment. Now you are seeking a $25,000 loan to finance the in- ventory needed to reach this year’s sales target. You have agreed to pledge your venture’s delivery truck and your personal automobile as support for the loan. Your sister has agreed to cosign the loan. During your initial year of operation, you paid your suppliers in...
4 questions MICROECONOMICS ECONOMIC VS. ACCOUNTING PROFITS - HOMEWORK BSE 2212 2) Chapter 9 #1. Gomez...
4
questions
MICROECONOMICS ECONOMIC VS. ACCOUNTING PROFITS - HOMEWORK BSE 2212 2) Chapter 9 #1. Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of $5,000 for his shop, and spends $20,000 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $4,000 per year if has been offered $15,000 per year to work as a potter for...
Please read the article and answer about questions. You and the Law Business and law are...
Please read the article and answer about questions. You and the Law Business and law are inseparable. For B-Money, the two predictably merged when he was negotiat- ing a deal for his tracks. At other times, the merger is unpredictable, like when your business faces an unexpected auto accident, product recall, or government regulation change. In either type of situation, when business owners know the law, they can better protect themselves and sometimes even avoid the problems completely. This chapter...
Budgeting for an Academic Department at a State University: Can You Believe the Numbers? INTRODUCTION You...
Budgeting for an Academic Department at a State University: Can You Believe the Numbers? INTRODUCTION You are the senior accounting faculty member in the business school and your dean, Dean Weller, is asking for help. She is very discouraged after a midyear budget meeting with the Vice President of Finance. The college's Department of Social Work has a large budget deficit, and because of this the VP is inclined towards closing the department entirely or closing its bachelor's program. The...
And there was a buy-sell arrangement which laid out the conditions under which either shareholder could...
And there was a buy-sell arrangement which laid out the
conditions under which either shareholder could buy out the other.
Paul knew that this offer would strengthen his financial
picture…but did he really want a partner?It was going to be a long
night.
read the case study above and answer this question
what would you do if you were Paul with regards to financing,
and why?
ntroductloh Paul McTaggart sat at his desk. Behind him, the computer screen flickered with...
MERCHANDISING ACOUNTING Joe Blink opened Blink Corporation. It has link Corporation. It has issued 20,000 shares...
MERCHANDISING ACOUNTING Joe Blink opened Blink Corporation. It has link Corporation. It has issued 20,000 shares of $4 par value common stock. It authorized 900,000 S od 900,000 share. The corporation is a merchandising business. Blink ventory system. Also Blink provides a 2-year warranty with one of its products which was first sold in October. Blink Corporation Trial Balance periodic inventory system September 30 Cr. Cash Dr. $ 54,000 14,000 Inventory Land 45,000 Plant Building 500,000 Accumulated Depreciation-plant Equipment 200,000...
Suppose that you open your own business and eam an accounting profit of $35,000 per year. When you started your business, you left a job that paid you a $30,000 salary annualy. Also, suppose that you invested $70,000 of your own funds to start up your business. If the normal rate of return on capital is 10 percent, your economic profit is O A, -$5,000. O B. $5,000. C.-$2,000 D. $2,000
4. Suppose that last year you started your own brewery. You had $90,000 in explicit costs, which included the wages you paid your employees and the costs associated with the purchase of the ingredients that went into making your beer. You also incurred $61,000 in implicit costs, which included the $50,000 salary ou were earning before you left your previous job to start the brewery business. Over the course of the year, you sold 20,000 bottles of beer at an...
You quit your job that pays $60,000 in order to open your own business. If your total revenue is $80,000, rent is $10,000, and supplies are $20,000, how much is your economic profit? Select one: O a. $10,000 O b. $10,000 O c. $20,000 O d. $30,000 Next pa # Perfect Competition in the Short Ru Jump to... wers
2. Suppose your friend was earning 22,000 a year as a sales representative for a T-shirt manufacturer. At some point she decided to open a retail store of her own to sell T-shirts. She invested 20,000 of savings that have been earning her $1,000 per year. And she decided that her new firm will occupy a small store that she owned and had been renting out for $5,000 per year. She hired one clerk to help her in the store,...
4
questions
MICROECONOMICS ECONOMIC VS. ACCOUNTING PROFITS - HOMEWORK BSE 2212 2) Chapter 9 #1. Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual rent of $5,000 for his shop, and spends $20,000 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $4,000 per year if has been offered $15,000 per year to work as a potter for...
Budgeting for an Academic Department at a State University: Can You Believe the Numbers? INTRODUCTION You are the senior accounting faculty member in the business school and your dean, Dean Weller, is asking for help. She is very discouraged after a midyear budget meeting with the Vice President of Finance. The college's Department of Social Work has a large budget deficit, and because of this the VP is inclined towards closing the department entirely or closing its bachelor's program. The...
And there was a buy-sell arrangement which laid out the
conditions under which either shareholder could buy out the other.
Paul knew that this offer would strengthen his financial
picture…but did he really want a partner?It was going to be a long
night.
read the case study above and answer this question
what would you do if you were Paul with regards to financing,
and why?
ntroductloh Paul McTaggart sat at his desk. Behind him, the computer screen flickered with...
MERCHANDISING ACOUNTING Joe Blink opened Blink Corporation. It has link Corporation. It has issued 20,000 shares of $4 par value common stock. It authorized 900,000 S od 900,000 share. The corporation is a merchandising business. Blink ventory system. Also Blink provides a 2-year warranty with one of its products which was first sold in October. Blink Corporation Trial Balance periodic inventory system September 30 Cr. Cash Dr. $ 54,000 14,000 Inventory Land 45,000 Plant Building 500,000 Accumulated Depreciation-plant Equipment 200,000...
Most questions answered within 3 hours.
-
3. Gains from trade
Consider two neighbouring island countries called Euphoria and
Contente. They each have...
asked 1 hour ago -
A business executive has the option to invest money in two
plans: Plan A guarantees that...
asked 3 hours ago -
Hello, can someone please help me answer this question?
How much heat is absorbed by a...
asked 3 hours ago -
. A marketing researcher conducted a survey of 25 shoppers
randomly selected at the local mall...
asked 4 hours ago -
Create an comprehensive response to the
following:
Antimicrobial agents work on a multitude of microbes (bacteria,...
asked 4 hours ago -
6.13 LAB: Step counter. Section 6.3.
A pedometer treats walking 2,000 steps as walking 1 mile....
asked 4 hours ago -
(14.2) A block of mass m = 10 kg riding on a frictionless
horizontal plane is...
asked 4 hours ago -
Use any search engine to search for articles about Starbucks
partnership with Tata Companies in India...
asked 4 hours ago -
Let’s say that for some reason Bank Excess Reserves suddenly
increase sharply. What effect would this...
asked 4 hours ago -
Given:
Curent Assets: $600,000
Total Assets: $2,600,000
Current Liabilities: $500,000
Total Liabilities: $1,700,000
What is the...
asked 4 hours ago -
1. What is a “Bankster”? What is insider trading? Why is it
illegal?
2. What is...
asked 4 hours ago -
A transverse wave on a cord is given by
D(x,t)=0.18sin(2.7x−61.0t), where Dand x are in m...
asked 4 hours ago