Question

what is the firm's market value today? assume that dantzler has zero nonoperating assets. enter your answer in millions. for example, an answer of $13,550,000 should be entered as 13.55. do not round intermediate calculations. round your answer to two decimal places. $ million

Answer 1

The firm's accounting profit is the sales revenue minus all costs, which in this case is $50,000, calculated by subtracting the costs for labor, capital, and materials from the $1 million sales revenue.

To calculate the firm's accounting profit, we subtract all the costs from the sales revenue.

The firm had sales revenue of $1 million last year, and incurred expenses on labor ($600,000), capital ($150,000), and materials ($200,000).

Accounting Profit = Sales Revenue - Total Costs
Accounting Profit = $1,000,000 - ($600,000 + $150,000 + $200,000)
Accounting Profit = $1,000,000 - $950,000
Accounting Profit = $50,000

Therefore, the firm's accounting profit last year was $50,000.