Question

Sundland Hardware reported cost of goods sold as follows?

Answer 1

The firm's accounting profit can be calculated by subtracting the total expenses from the sales revenue. In this case, the firm's expenses include labor ($600,000), capital ($150,000), and materials ($200,000), which add up to $950,000. Therefore, the accounting profit is $50,000.

Step-by-step explanation:

The firm's accounting profit can be calculated by subtracting the total expenses from the sales revenue. In this case, the firm's expenses include labor ($600,000), capital ($150,000), and materials ($200,000), which add up to $950,000. Therefore, the accounting profit is calculated as follows:

Accounting Profit = Sales Revenue - Total Expenses

= $1,000,000 - $950,000

= $50,000

Therefore, the firm's accounting profit is $50,000.