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Accounting Profit is a company's sum total earnings, computed according to Generally Accepted Accounting Principles (GAAP), and involves the explicit costs of operating business, like interest, depreciation and taxes.
Accounting profits tend to be more than economic profits as they skip some implicit costs, like opportunity costs. For instance, if you invest $100,000 to establish a business and gained $120,000 in profit then your accounting profit would be $20,000. Economic profit would put in implicit costs; like the opportunity cost of $50,000 should you have been employed in its place during that particular period. As shown by this, you would have an economic loss of $30,000 i.e. $120,000 - $100,000 - $50,000).
Cretin Enterprises uses a predetermined overhead rate of $21.40 per direct labor-hour. This predetermined rate was based on a cost formula that estimated $171,200 of total manufact
Linear Programming This section introduces the general method called the simplex algorithm, which is designed to solve any linear program. The information that can be secured
C-V-P ANALYSIS – MULTIPLE PRODUCTS The simple product CVP analysis can be extended to handle the more realistic situations where the firm produces more than one product. The o
Definition of the Mission and Goals of the Organization Generally the organization has already established mission and aim statements. Though, it may be essential to redefine
Managerial Accounting Before going to Managerial Accounting let us discuss a bit about Financial Accounting. Financial accounting is concerned with reporting to the external pa
Application of Transportation Model In the direct logic, the transportation model looks for the determination of a transportation plan of a particular commodity from a number o
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Explain about Office and administrative expenses These expenses are not related to factory but they pertain to the management and administration of the business. Such expenses
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