What Is "Maximizing Profits" as a Social Responsibility Theory in Business

question 32

Multiple Choice

What is "maximizing profits" as a social responsibility theory in business?

• A)The theory that a corporation must consider the effects its actions have on persons other than its shareholders.
• B)The theory that a corporation's duty is to make a profit while avoiding causing harm to others.
• C)The theory that a corporation owes a duty to take actions that increases profits for shareholders.
• D)The theory that a business has a responsibility solely to its stakeholders that other than shareholders.

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Definitions:

Significant Accounting Policies

The specific accounting principles and methods of computation adopted by a business to prepare its financial statements, reflecting its transactions in a consistent manner.

Management's Discussion

A section of a company's annual report where management discusses the firm's performance, trends, and future outlook.

Related-Party Transactions

Financial transactions that occur between individuals or entities that have a particular relationship, typically one that can influence the management or operating policies of the entities involved.

Comparative Balance Sheets

Financial statements that provide a snapshot of a company's financial condition at different points in time to analyze trends or changes in financial position.