Question

normal profit is average profit earned?​

Answer 1

Answer:

profit= S.P. - C.P

Percent profit is profit× 100/CP

Answer 2

Explanation:

Normal profit is a situation where a firm makes sufficient revenue to cover its total costs and remain competitive in an industry. In measuring normal profit, we include the opportunity cost of working elsewhere. When a firm makes normal profit we say the economic profit is zero.

The profit earned by a business during previous accounting periods on an average basis is termed as the Average Profit. It takes into account the average profits for the past few years and fixes the value of goodwill as to many year's purchase of this amount. Average profit maybe simple or weighted in nature.