Question

What is the Net Profit for the year ended 31st December, 200X?

a) $2,750
b) $3,250
c) $4,000
d) $5,000

Answer 1

The accounting profit for the year can be calculated by subtracting the explicit costs from the total revenues. In this case, the accounting profit is $50,000.

Step-by-step explanation:

The accounting profit for the year ended 31st December, 200X can be calculated by subtracting the explicit costs from the total revenues. Given the information provided in Chapter 7, the explicit costs are $600,000 + $150,000 + $200,000 = $950,000. Therefore, the accounting profit is $1,000,000 - $950,000 = $50,000