why a manager prefers economic profit instead of accounting profit in decision making? Consider the example, Last year Mr. Kamal quit his $100,000 per year job as a webpage designer for a leading computer software company to buy a small hotel at Dhanmondi Lake. The purchase price of the hotel was $400,000, which he financed by selling a tax-free Treasury bond that earned 12.5% per year. Kamal’s total operating expenses and revenues were $900,000 and $1200,000, respectively. Calculate Kamal’s accounting profit and economic profit and provide the correct decision.

Answer rating: 100% (QA)

Accounting profits RevenueExpenses1200000900000300000 Profit 3... View the full answer