Question

consider the following: net income =$10000, depreciation expense = $2,000, accounts receivable increased by $700

Answer 1

The subject of this question is Business and the grade level is College this question relates to accounting profit and depreciation expense.

To calculate accounting profit, we subtract explicit costs from total revenues.

In this case, the total revenues amount to $1,000,000 and the explicit costs amount to ($600,000 + $150,000 + $200,000). So, the accounting profit would be $50,000.

Depreciation expense, on the other hand, refers to the decrease in the value of an asset over time. In this case, the depreciation expense is given as $2,000.