he following is cost information for the Creamy Crisp Donut Company: Entrepreneur's potential earnings as a salaried worker = $50,000 Annual lease on building = $22,000 Annual revenue from operations = $380,000 Payments to workers = $120,000 Utilities (electricity, water, disposal) costs = $8,000 Value of entrepreneur's talent in the next best entrepreneurial activity = $80,000 Entrepreneur's forgone interest on personal funds used to finance the business = $6,000 Refer to the data

The accounting profit will only account for the cost which is being paid out, so all the foregone opportunity cost will not be a part of accounting profit and this is the main difference between accounting and economic profits.

So the total accounting cost here will be equal to, annual lease on building + payments to workers + costs of utilities.

= $22,000 + $120,000 + $8,000

= $150,000

And the revenue from the operations is equal to,

= $380,000

And the profit is calculated as,

Accounting Profit = revenue - accounting costs

Accounting Profit = $380,000 - $150,000

Accounting Profit = $230,000.

So the correct answer is option C, $230,000.