Make big profit

3 Responses to “Economic profit vs. accounting profit?”

1. i am ok, your ok, on August 21st, 2010 at 3:52 am Said:

   Yes. your right. Accounting profit is equal to the revenues minus the explicit costs. Economic profit is equal to revenue minus explicit and implict costs. Explicit costs are expenses where you pay money. Implicit costs are like the opportunity costs, like the value of the owner’s labor. Economic profit will always be less than accounting profit.

2. Sageandscholar, on August 22nd, 2010 at 7:58 pm Said:

   Yes you are spot on.

3. anand j, on August 24th, 2010 at 10:40 pm Said:

   accounting profit is income less actual expenses and economic profit is income less actual and notional expenses economic profit is always less than accounting profit

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