How Does Accounting Profit Differ from Economic Profit? Explain Why

question 22

Essay

How does accounting profit differ from economic profit? Explain why accounting profit is more useful for paying your taxes while economic profit is more useful for deciding whether you should continue to stay in business. Give an example of an implicit cost and an example of implicit revenue.

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Definitions:

Corporate Rituals

Established ceremonies or actions performed in a company that symbolize its values and culture.

Unique Stories

Distinct narratives or accounts that set individuals, organizations, or events apart from others.

Ceremonies

Formal or ritualistic events often conducted in honor of a particular occasion, achievement, or tradition.

Strategic Issues

Significant matters that impact the direction and success of an organization, often requiring decision-making at the highest level of leadership.