AuthorTopic: accounting costs vs Economic Cost
@2008-11-07 18:18:11

I am a bit confused about accounting costs and economic costs. Why do we add lease costs back to accounting profit to compute economic profit? I thought leases were part of fixed costs and should be ignored. I was doing some problems on the textbook and got confused. Does anyone know the intuition behind this?

CFA Discussion Topic: accounting costs vs Economic Cost

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I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!