Profit Maximization Fails Because It Ignores All EXCEPT

question 10

Multiple Choice

Profit maximization fails because it ignores all EXCEPT

• A) the timing of returns.
• B) earnings per share.
• C) cash flows available to stockholders.
• D) risk.

---

Definitions:

Variable Overhead Efficiency Variance

A measure used to assess the efficiency of variable overhead resource usage, calculated as the difference between actual and expected costs based on standard usage rates.

Direct Materials Purchases Variance

The difference between the actual cost of materials purchased and the expected cost at standard prices.

Direct Labor-Hours

An alternative term for direct labor-hour, referring to the labor time spent by employees directly on manufacturing a product.

Materials Price Variance

The difference between the actual cost of materials purchased and the expected (standard) cost times the actual quantity of materials used.