Answer:
Economic profit for the year is
Explanation:
The accounting profit will be Revenue - expenses (150,000-35,000) $ 115,000. However this problem requires us to calculate economic profit. Economic profit is different from accounting profit. While calculating it opportunity costs also become part of expenses as implicit costs. Detail calculation is given below.
Economic profit = 150,000 -35,000-20,000 = $ 95,000
