Which Theory Holds That Social Responsibility Is Paying Attention to the Interest

question 70

Multiple Choice

Which theory holds that social responsibility is paying attention to the interest of every affected stakeholder in every aspect of a firm's operation?

• A) stockholder theory
• B) theory of reasoned action
• C) attribution theory
• D) theory of ethical enhancement
• E) stakeholder theory

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Definitions:

Gross Profit Rate

The ratio of gross profit (sales minus cost of goods sold) to net sales, showing the efficiency at which a company produces its goods.

Partial Equity Method

A variation of the equity method, where initial recognition is at cost and subsequent recognition involves recording dividends as income and not adjusting for the investee's retained earnings.

Upstream Inventory Transfers

Transactions where goods are sent from a subsidiary to the parent company, often analyzed for transfer pricing and tax purposes.

Downstream Inventory Transfers

The movement of inventory from a parent company to a subsidiary or between subsidiaries, typically involving finished goods or products closer to the end of the supply chain.