Asha Kanta Sharma (Manager - Finance & Accounts) 11 August 2020
When partners wants Salary to be paid for their operations in the business then it is called EXPLICIT COST which must be recorded in business.
Implicit cost only arrives when someone forgoes their Salary or interest or any other monetary benefits for long term benefit and success.
Implicit costs are harder to measure than explicit ones, which makes implicit costs more subjective. Implicit costs help managers calculate overall economic profit, while explicit costs are used to calculate accounting profit and economic profit.