Explicit cost
An explicit cost is a direct payment made to others in the course of running a business, such as wage, rent and materials,[1] as opposed to implicit costs, where no actual payment is made.[2] It is possible still to underestimate these costs, however: for example, pension contributions and other "perks" must be taken into account when considering the cost of labour.[2]
Explicit costs are taken into account along with implicit ones when considering
Accounting profit only takes explicit costs into account.[1]
References
- ^ ISBN 978-0-324-31461-8. Retrieved 3 October 2010.
- ^ ISBN 0-297-76899-9.