Question

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 alternatively invested. He has been offered $15,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $3,000 per year. Total annual revenue from pottery sales is $72,000. Instructions: Enter your answers as whole numbers a.Calculate the accounting profit for Gomezs pottery firm b. Now calculate Gomezs economic profit.

0 0
Add a comment Improve this question Transcribed image text
Request Professional Answer

Request Answer!

We need at least 10 more requests to produce the answer.

0 / 10 have requested this problem solution

The more requests, the faster the answer.

Request! (Login Required)


All students who have requested the answer will be notified once they are available.
Know the answer?
Add Answer to:
Gomez runs a small pottery firm. He hires one helper at $12,000 per year, pays annual...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Similar Homework Help Questions
  • Costs HW-Ch 9 Check my w Gomez runs a small pottery firm. He hires one helper...

    Costs HW-Ch 9 Check my w Gomez runs a small pottery firm. He hires one helper at $14,500 per year, pays annual rent of $7,500 for his shop, and spends $18,000 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 $5,000 per year if alternatively invested. He has been offered $23,000 per year to work as a potter for a competitor. He estimates his entrepreneurial...

  • 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...

  • Gita is an auto mechanic and runs a small repair shop. She hires one mechanic at...

    Gita is an auto mechanic and runs a small repair shop. She hires one mechanic at $20,000 per year, pays a monthly rent of $5,000 towards the lease of the premises where her repair shop is located, and spends $20,000 per year on materials needed for repairing cars and trucks. She has invested $40,000 of her own savings in heavy equipment (air and strut compressors, brake lathes, heavy-duty lifts etc.) that could earn her $4,000 per year if invested elsewhere....

  • 1. The below question shows Short-Run productivity data for a small busin Units of Labor Total...

    1. The below question shows Short-Run productivity data for a small busin Units of Labor Total Product Marginal Product Average Product O 75 JUNHO 104 16 126 119 104 a. Complete the table above by calculating Marginal Product and Average Product. 120 SANNE 15 b. Explain why, in the short run, Marginal Product first rises, then declines, and ultimately becomes negative. c. What happens to Marginal Cost when Marginal Product is rising? When Marginal Product is falling? c. What happens...

  • 1. A firm sells 150 units of output at a price of $8 each. The economic...

    1. A firm sells 150 units of output at a price of $8 each. The economic cost of producing the 150 units of output is $1,000. Calculate the firm's level of economic profit. 2. Claire's Cafe hires you to determine the business's status. The data below provides information on the company's annual costs and revenues. Wages $85,000 Interest paid on loans 7,000 Other expenditures for factors of production 67,000 Total Revenue 250,000 Claire spends at least 40 hours a week...

  • 1. Ralph owns a small pizza restaurant, where he works full-time in the kitchen. His total revenue last year was $100,000, and his rent was $3,000 per month. He pays his one employee $2,000 per month,...

    1. Ralph owns a small pizza restaurant, where he works full-time in the kitchen. His total revenue last year was $100,000, and his rent was $3,000 per month. He pays his one employee $2,000 per month, and the cost of ingredients and overhead averages $500 per month. Ralph could earn $35,000 per year as the manager of a competing pizza restaurant nearby. His total explicit costs for the year were a. $24,000. b. $66,000. c. $72,000. d. $60,000. e. $6,000....

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT