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The answer is b, how to get this answer? The explicit cost is 200000+50000(from her own savings) Use the following information to answer question. Madelyn
The answer is b, how to get this answer? The explicit cost is 200000+50000(from her own savings)
Use the following information to answer question. Madelyn owns a small pottery factory. She can make 1,000 pieces of pottery per year and sell them for $100 each. It costs Madelyn $20,000 for the raw materials to produce the 1,000 pieces of pottery. She has invested $100,000 in her factory and equipment: $50,000 from her savings and $50,000 borrowed at 10 percent (assume that she could have loaned her money out at 10 percent, too). Madelyn can work at a competing pottery factory for $40,000 per year. The accounting profit at Madelyn's pottery factory is a. $70,000. O b. $75,000. c. $30,000. d. $80,000. e. $35,000Step by Step Solution
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