Which of the following is true of profit maximization?
A) Profit maximization is achieved by considering the financial measures focused on only efficiency.
B) Profit maximization is an objective of financial accounting but not managerial accounting.
C) Profit maximization should be achieved through legal and ethical means.
D) Profit maximization results in maximum cost to and maximum production by a company.

Question

Quizplus · Accepted Answer

Profit maximization is an important objective of a company, but it should not come at the cost of legal and ethical considerations. A company must balance profitability with social responsibility, which includes complying with laws and ethical standards. Maximizing profits while remaining within the boundaries of the law and ethics is a more sustainable approach for the long-term success of a company. Choices A, B, and D are incorrect because profit maximization requires considering all financial measures, not just efficiency, and is an objective of both financial and managerial accounting. It also aims to achieve maximum profit with minimum cost and resources, not maximum cost and production.

Which of the Following Is True of Profit Maximization