The Only Way to Maximize Profits Is to Reduce Costs

question 96

True/False

The only way to maximize profits is to reduce costs by operating more efficiently.

---

Definitions:

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company's balance sheet.

Credit

An accounting entry that increases liabilities or equity or decreases an asset or expense.

Underapplied Manufacturing Overhead

A situation where the allocated manufacturing overhead costs are less than the actual overhead costs.

Overapplied Manufacturing Overhead

Occurs when the amount of overhead applied to products or services exceeds the actual manufacturing overhead costs incurred.