info in images Gomez runs a small pottery firm. He hires one helper at $13,000 per year, pays annual rent of $5,500 for his shop, and spends$21,500 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that couldearn him $5,500 per year if alternatively invested. He has been offered $19,000 per year to work as a potter for a competitor. Heestimates his entrepreneurial talents are worth $2,500 per year. Total annual revenue from pottery sales is $75,000.Instructions: Enter your answers as a whole number.Calculate the accounting profit and the economic profit for Gomez's pottery firm.Accounting profit = $Economic profit = $ You are a newspaper publisher. You are in the middle of a one-year factory rental contract that requires you to pay $500,000 permonth, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have a marginalprinting cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper.Instructions: Enter your answers rounded to two decimal places.a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC pernewspaper?AFC per newspaper risesv from $to $b. What happens to the MC per newspaper?MC per newspaper does not changec. What happens to the minimum amount that you must charge to break even?It risesv from $to

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Gomez runs a small pottery firm. He hires one helper at $13,000 per year, pays annual rent of $5,500 for his shop, and spends $21,500 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $5,500 per year if alternatively invested. He has been offered $19,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $2,500 per year. Total annual revenue from pottery sales is $75,000. Instructions: Enter your answers as a whole number. Calculate the accounting profit and the economic profit for Gomez's pottery firm. Accounting profit = $ Economic profit = $

Gomez runs a small pottery firm. He hires one helper at $13,000 per year, pays annual rent of $5,500 for his shop, and spends $21,500 per year on materials. He has $40,000 of his own funds invested in equipment (pottery wheels, kilns, and so forth) that could earn him $5,500 per year if alternatively invested. He has been offered $19,000 per year to work as a potter for a competitor. He estimates his entrepreneurial talents are worth $2,500 per year. Total annual revenue from pottery sales is $75,000. Instructions: Enter your answers as a whole number. Calculate the accounting profit and the economic profit for Gomez's pottery firm. Accounting profit = $ Economic profit = $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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