The Responsibility Report of Alejandro Garcia,the Manager of One of the Divisions

question 55

Multiple Choice

The responsibility report of Alejandro Garcia,the manager of one of the divisions of an auto parts manufacturing company,includes profits as well as return on investment and residual income.Alejandro is most likely the manager of a(n) ________.

• A) investment center
• B) profit center
• C) cost center
• D) revenue center

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Definitions:

Price-Taking Firms

Firms that accept the market price as given and have no power to influence it.

Unrealistic

Lacking consideration of real situations; impractical or idealistic.

Restrictive

A term describing measures or policies that limit or constrain actions, activities, or expansions.

Variable Cost

Costs that change in proportion to the level of output or activity, such as materials and labor directly involved in production.