An Economist's Measurement of Profit Differs from an Accountant's in That

question 61

Multiple Choice

An economist's measurement of profit differs from an accountant's in that:

• A) accountants calculate total revenue differently than do economists.
• B) economists do not always include all of the opportunity costs when calculating total production costs.
• C) accountants do not always include all of the opportunity costs when calculating total production costs.
• D) economic profit generally exceeds accounting profit.

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Definitions:

Governmental Fund Financial Statements

Financial reports that detail the financial position and results of operations for the government funds, embracing a diverse range of governmental activities and services.

Fund Financial Statements

Financial reports that detail the income, expenditures, and other financial activities of a particular fund within an organization.

Incremental Borrowing Rate

The interest rate a lessee would have to pay to borrow under a similar term, and with similar security, the funds necessary to obtain an asset lease.

Net Position

The difference between the total assets and total liabilities of an entity, representing its net worth or equity value.