What is the difference between zero accounting profit and zero economic profit?

Question

I have been using the web to try and find information on both zero accounting profit and zero economic profit and all I keep coming up with is zero accounting profit and economic vs accounting profit. Help please.

Answer 1

Accounting profit includes "paper" expenses such as depreciation and amortization where as ecomonic income does not.

Hope this helps.

Answer 2

I'll put it in simple terms...

Zero Accounting Profit--means there is no dollar/monetary amount or value producing a profit. $0.00

Zero Economic Profit--means there are no benefits to reap or prosper from

(for instance if you had reached a $50 monetary / accounting profit you would receive 10 free books for each dollar...the free books were an Economic profit, or say a free lunch for every employee for breaking even (that would be an economic profit). Economic profit are benefits that you can gain an incentive like profit from.    

Answer 3

Zero accounting profit means total revenue - total explicit costs = $0.

Explicit costs are costs that you can account for with documents, not abstract figures without any justification.

Zero economic profit means total revenue - total explicit costs - total implicit costs = $0

Implicit costs are costs such as "I should have worked for someone instead of running a business", very subjective and without good justification. It usually represents an owner's personal resources when it comes to running a business (e.g. owner's labour cost).