Answer:
The correct answer is option b.
Explanation:
Samantha was earning a salary of $80,000 while working for a law firm.
She decides to open her own practice.
Her annual expenses will include $15,000 for office rent, $3,000 for equipment rental, $1,000 for supplies, $1,200 for utilities, and a $35,000 salary for a secretary/bookkeeper.
The total accounting or explicit costs
= $15,000 + $3,000 + $1,000 + $1,200 + $35,000
= $55,200
Accounting profit = Total revenue - Accounting costs
$50,000 = Total revenue - $55,200
Total revenue = $50,000 + $55,200
Total revenue = $105,200
