Lisa leases her building for $250,000 per year for 3 years. Explicit cost of maintaining the building is $60,000. Implicit cost is $35,000. All revenues are received and cost borne at the end of each year. If the interest rate is 8%, what is the Present value of (i) Accounting Profit and (ii) Economic Profit

**I'm not sure if I can just use (1) the PV = FV/(1+ i)^n formula or (2) Calculate the Accounting Profit (Total Revenue-Explicit Cost) and use this value to PV = FV1/(1+i)^1 + FV2/(1+i)^2 + FV3/(1+i)^3

Question

Lisa leases her building for $250,000 per year for 3 years. Explicit cost of maintaining the building is $60,000. Implicit cost is $35,000. All revenues are received and cost borne at the end of each year. If the interest rate is 8%, what is the Present value of (i) Accounting Profit and (ii) Economic Profit

**I'm not sure if I can just use (1) the PV = FV/(1+ i)^n formula or (2) Calculate the Accounting Profit (Total Revenue-Explicit Cost) and use this value to PV = FV1/(1+i)^1 + FV2/(1+i)^2 + FV3/(1+i)^3