Final answer:
The accounting profit of the Ralston Company is calculated by subtracting total expenses from the sales revenue; with $1 million in sales and $950,000 in total expenses, the firm's accounting profit is $50,000.
Step-by-step explanation:
The question refers to calculating the accounting profit for the Ralston Company based on its sales revenue and expenses for the most recent fiscal year. To determine the firm's accounting profit, we subtract the total expenses from the sales revenue.
In this scenario, the company had a sales revenue of $1 million, and the expenses included $600,000 on labor, $150,000 on capital, and $200,000 on materials.
Here's the calculation:
Sales revenue: $1,000,000
Total expenses (labor + capital + materials):
$600,000 + $150,000 + $200,000 = $950,000
Accounting profit: Sales revenue - Total expenses
= $1,000,000 - $950,000
= $50,000
Therefore, the accounting profit for the Ralston Company for the most recent fiscal year would be $50,000.