Question

The specific sales or profit objective a salesperson is expected to achieve is known as the

A. return on investment.
B. break-even point.
C. sales quota.
D. payback point.
E. accounting profit.

Answer 1

The specific objective a salesperson aims to achieve in terms of sales or profits is known as the sales quota. The correct answer is option c.

Step-by-step explanation:

This term refers to the target set for a salesperson or a team to motivate performance and measure success. Sales quotas can be set on various bases, such as revenue, the number of units sold, or the number of new client accounts opened.

In the context of a perfectly competitive firm, decisions on what quantity to produce rely greatly on market conditions and the firm's production capacity. The basic definition of profit is total revenues minus total costs, and for a firm with simple operations, this largely comes down to choosing the right quantity to produce to maximize profit.

For instance, if a firm had sales revenue of $1 million last year and it spent $600,000 on labor, $150,000 on capital, and $200,000 on materials, the firm's accounting profit would be the sales revenue minus these explicit costs. Here, the firm's accounting profit would be $1,000,000 (revenue) - $600,000 (labor) - $150,000 (capital) - $200,000 (materials) = $50,000.