NORMAL PROFIT Definition

Bookmark and Share

NORMAL PROFIT is the opportunity cost of using entrepreneurial abilities in the production of a good, or the profit that could have been received by entrepreneurship in another business venture. Like the opportunity costs of other resources, normal profit is deducted from revenue to determine economic profit. It is, however, never included as an accounting cost when accounting profit is computed.

Learn new Accounting Terms

COMPANY LIMITED BY GUARANTEE is where the liabilities of the members will be restricted to the amount each agrees to contribute to the assets of the company in the event of dissolution or liquidation.

MAJORITY INTEREST is an ownership interest greater than fifty percent (50%) of the voting interest in a business enterprise.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.