Question

how much money should my llc be making in gross profit to write off a $100,000 asset under irs section 179?

Answer 1

To calculate the firm's accounting profit, subtract total expenses from the sales revenue. The firm's sales revenue was $1 million, with expenses totaling $950,000, resulting in an accounting profit of $50,000.

Step-by-step explanation:

To determine the firm's accounting profit, we must subtract the total expenses from the sales revenue. In this case, the firm's sales revenue was $1 million. The expenses include $600,000 on labor, $150,000 on capital, and $200,000 on materials.

First, we calculate the total expenses by adding $600,000 (labor) + $150,000 (capital) + $200,000 (materials) = $950,000.

Next, we subtract the total expenses from the sales revenue to find the accounting profit:

$1,000,000 (sales revenue) - $950,000 (total expenses) = $50,000.

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