Final answer:
The firm's accounting profit is calculated by subtracting total costs from sales revenue. With a sales revenue of $1 million and total costs of $950,000, the firm's accounting profit was $50,000.
Step-by-step explanation:
To determine the firm's accounting profit, we subtract the total costs from the sales revenue. In this case, the firm had sales revenue of $1 million last year. It spent $600,000 on labor, $150,000 on capital, and $200,000 on materials. The accounting profit can be calculated as follows:
Sales Revenue - Total Costs = Accounting Profit
$1,000,000 - ($600,000 + $150,000 + $200,000) = $1,000,000 - $950,000 = $50,000
Therefore, the firm's accounting profit was $50,000.