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Business, 27.05.2020 15:57 teamroper35
Gomez runs a small pottery firm. He hires one helper at $10,500 per year, pays annual rent of $4,500 for his shop, and spends $19,000 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $5,000 per year if alternatively invested. He has been offered $21,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $3,000 per year (input cost for organizing resources). Total annual revenue from pottery sales is $71,000. Calculate the accounting profit and the economic profit for Gomez’s pottery firm.
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Gomez runs a small pottery firm. He hires one helper at $10,500 per year, pays annual rent of $4,500...
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