If a Firm Has Total Costs of $535,000 and Its

question 84

Multiple Choice

If a firm has total costs of $535,000 and its implicit costs are $165,000,how much are its explicit costs?

• A) $3,242
• B) $120,000
• C) $370,000
• D) $700,000
• E) $308

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Definitions:

Unearned Revenue

Funds paid to a person or corporation for goods or services that are to be provided or delivered in the future.

Patent

A legal document granted by the government giving an inventor exclusive rights to make, use, and sell an invention for a certain number of years.

Office Supplies

Items used in an office on a regular basis, such as paper, pens, and envelopes, which are consumed in use and need regular replenishment.

Temporary Accounts

Accounts used to record transactions within a specific accounting period, which are then closed and transferred to permanent accounts at the end of the period to prepare the company's financial statements.