Suppose you decided to open your own bakery business. At the start of the year you took $18,477 out of you saving account, where the money had been earning an interest rate of7%, and you used it to purchase ovens and other equipment needed for the bakery. You also quit your job where you were earning $55,787 per year. Over the course of the year you spent $8,102 on ingredients like flour and sugar, $40,316 on the salaries of two employees, $15,214 on rent for you bakery space and $14,150 on other miscellaneous like electricity, packaging and office supplies. Over the course of the year you sold 22,340 bakery items (cakes, pies and so on) at an average price of $8 each. What was your accounting profit last year?

Suppose you decided to open your own bakery business. At the start of the year you took $18,477 out of you saving account, where the money had been earning an interest rate of7%, and you used it to purchase ovens and other equipment needed for the bakery. You also quit your job where you were earning $55,787 per year. Over the course of the year you spent $8,102 on ingredients like flour and sugar, $40,316 on the salaries of two employees, $15,214 on rent for you bakery space and $14,150 on other miscellaneous like electricity, packaging and office supplies. Over the course of the year you sold 22,340 bakery items (cakes, pies and so on) at an average price of $8 each. What was your accounting profit last year?

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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