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If an organisation earns reasonable income after covering its costs, which objective is being fulfilled?

Answer and explanation

Correct answer: Profit

The governing concept is the profit objective. Profit is the surplus remaining when revenue or income exceeds the cost of producing and selling goods or services. In the stated situation, the organisation first covers its costs and then earns a reasonable return; this directly indicates fulfilment of the profit objective. Therefore, option B is correct. Social objectives concern responsibilities toward society, respect is not a standard organisational objective in this context, and job security concerns employee welfare. The word “reasonable” also signals that the objective is sustainable and ethical earning, not exploitation or excessive profit at the expense of stakeholders.

Related tags

ProfitIncomeCostObjectives Of ManagementNature And Significance Of ManagementBusiness StudiesClass 12 Mcq

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