HERNANDEZ, NINA CASSANDRA M.

 
BSBA FM1-G2
 ECONOMICS

UNIT 7 ANALYSIS OF COST (2)

1. Differentiate between business profit and economic profit

 Profit is a widely used financial statistic for assessing a company's financial
health. It's the profit or revenue created by a business or investment activity after
all expenses, taxes, and other costs have been deducted. Profits are simply
income minus costs. There are two sorts of profits: economic and accounting
profits. Total sales income minus opportunity costs from all inputs equals
economic profit. Accounting profit, on the other hand, is a company's overall
profit after all expenditures have been deducted.