12. accounting expense versus economic cost Paton states "...the accountant’s ’expense’ for the particular business and the economist’s ’cost of production’ are two quite different things...[The] whole scheme of accounting is based upon the plan of showing as costs or expense only the expirations of purchased commodities and services, not the economic value of the services contributed by the business itself in furnishing capital and management"
(Paton [1923], pages 493-494). Carefully comment on the difference between accounting expense and economic cost.