If Total Revenue Covers Explicit Costs but Not Opportunity Costs,then

question 27

Multiple Choice

If total revenue covers explicit costs but not opportunity costs,then

• A) both economic profit and accounting profit are positive.
• B) economic profit is positive,but accounting profit is negative.
• C) accounting profit is positive,but economic profit is negative.
• D) neither accounting profit nor economic profit is positive.
• E) accounting profit is negative,but economic profit may be positive or negative.

---

Definitions:

Machine Hours

The total number of hours that machinery operates during a specific period for manufacturing or production processes.

Raw Materials

Raw materials are the basic, unprocessed inputs used in the manufacture of products.

Charged

Charged refers to recording or incurring an expense or cost against a company's accounts or to the process of loading a financial obligation onto a financial account.

Cost Accounting Systems

Methods and procedures used for collecting, classifying, analyzing, and allocating costs associated with a process, product, or project.