Dr.R.

KAMARAJ
Assistant Professor
Department of Commerce (Computer Application)
S.A. College of Arts & Science
 ACCOUNTING PROFIT

Accounting profit is the Net Income that a company generates,

found at the bottom of its income statement. The figure includes all
revenue the company generates and deducts all expenses to arrive at
the bottom line.

To calculate Accounting Profit, whether company makes money or

loses money, you will use a formula:
Total Revenues - Total Expenses = Accounting Profit / Loss
 ECONOMIC PROFIT
Economic profit is the profitability

measurement that calculates the amount that

revenues received from selling a product

exceeds opportunity costs incurred from using

resources to make and sell these products.

Economic profit = Revenues - Explicit costs -

Opportunity costs