Profit: the only goal of the firm

Firms/businesses would always like their consumers to believe that they are personally striving to help us and if we consume their products, it makes the world that much better. In class, we heard examples of “goals” such as, to focus on innovation and growth, to inspire and nurture the human spirit, and to spearhead the digital media revolution. Claims such as these can be heard daily in ads, in the newspapers, and on tv. Think about it. “Like a good neighbor, State Farm is there?” A huge insurance company really thinks that by using this slogan, we will compare them to one of our neighbors? But what is their REAL goal? Money; getting as much as they can from us and maximizing their profit.
But even the ideas of “profit” and what it costs to make a profit are debatable. Depending on who you ask, profit could have very different meanings. For example, accountants view total cost as expenses and depreciation, while economists view total cost as the sum of implicit and explicit costs or as opportunity cost. An explicit cost is a cost paid in money, but an implicit cost is an opportunity cost incurred by a firm when it uses a factor of production but does not make a direct payment. Even the concept of depreciation will vary depending on who you are talking to. Economic depreciation is considered the opportunity cost of the firm using the capital it owns. It is measured in the change in the market value of the capital. On the other hand, accounting depreciation is calculated using IRS rules. Basically, normal profit is the cost of not doing something else with your time, but there are even different types of profit such as economic profit or excess profit.
Why should all of this matter? I assume most of us enrolled in this class want to eventually earn a type of business degree, accounting degree, or marketing degree. It seems the business world and the world of money can be a bit cut throat at times, and if you don’t know the rules on how to reach and please your consumer with a well-rehearsed, touching goal while still trying your hardest to get a profit for yourself, your business will not succeed. It is important that we can all see through the sugar coated goal and understand the real meaning of making a profit.