Identify each of alexs costs in the table

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Reference no: EM133918322

Problem

Alex lives in San Francisco and operates a small company selling electronic cigarettes. On average, he receives $1,061,000 per year from selling electronic cigarettes. Out of this revenue from sales, he must pay the manufacturer a wholesale cost of $590,000. He also pays several utility companies, as well as his employees wages totaling $371,000. He owns the building that houses his storefront; if he choose to rent it out, he would receive a yearly amount of $25,000 in rent. Assume there is no depreciation in the value of his property over the year. Further, if Alex does not operate the electronic cigarette business, he can work as a programmer and earn a yearly salary of $72,000 with no additional monetary costs, and rent out his storefront at the $25,000 per year rate. There are no other costs faced by Alex in running this electronic cigarette company. Get the instant assignment help.

1) Identify each of Alex's costs in the table as either an implicit cost or an explicit cost of selling electronic cigarettes.

2) Complete the table by determining Alex's accounting and economic profit of his electronic cigarette business.

Reference no: EM133918322

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