Questions regarding economic and accounting profit.?

Bob has been made a standing offer of $1 million for his burger shop by a competitor. He will also receive $50k/year if he sells out. Bob figures he could earn 10% on that $1 million. Currently Bob's burger shop generates $200k in revenue and has expenses (wages, utilities etc.) of $100k. The original investment was $100k but the business is worth alot more today. Which would be considered explicit and implicit costs? Should he sell out from the point of view of an accountant and an economist? Would their views change if he inherited this business? How about if he owed $1 million to the bank on a 10% loan?Questions regarding economic and accounting profit.?
Accountant Point of View :

Original investment =$100K;

Offered price =$ 1 million ;

Profit = $1000K-100K =900K

Offer is attractive ,may be accepted.

Economist Point of view :

The present earning of the project are =$100K after deducting the expenses.

After sale earning = $50K + $ 100K (from interest) =$150K Implicit cost : rise in business , fluctuations in interest rates etc.

Hence, he has to consider how much rise in business can be there.Only then final decision can be taken.



Explicit Cost :

- Revenue generated;

- Expenses ;

- Original cost ;

Implicit Cost :

- Rise in business;

- Share of the market hold;

- Competitors Share;

- Competitors strengths and weaknesses.



-In case he owed a loan of $1 million to the bank @10 % , he can sell out the business since after selling he will return all the amount to bank and will earn $50K only .

However here also the implicit cost of rise in business becomes important.



-In case he inherted the business even then the views should not change.

-Questions regarding economic and accounting profit.?
Do NOT sell your business by no means, here are the reasons: first if a compitito wants to buy your resturant it means its a threat to him and its a usful toll for him so it means you have a good business, second if its generating 100k you are on a good track and also you can still grow in all aspects of the bussines, and last my dicesion would not change in your last statements of posibilities your best bet in all ways is to keep the shop.