opportunity cost

[imdad1]

Agreed with the above answer!!!
Oppourtunity cost is computed for decision making.....

thats y financial manangement and financial accouting are two different areas!! )

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by moniacca</i>
<br /><blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by mashfaq</i>
<br />Why opportunity cost is not recognized while calculating the accounting profit? I need some logical reasons ( In the light of accounting standards or applications) . I also know that it is the implicit cost
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Financial statements are prepared on accrual basis. Opportunity cost is not the cost that is actually incured and/or does not relates to the period for which financial statements are prepared. So opportunity costs are not recognized while calculating the accounitng profits.

I hope my reply will help you.

Comments are appreciated.
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