​Which of the Following Is TRUE

question 4

Multiple Choice

​Which of the following is TRUE?

• A)​Maximizing division profits can sometimes lead to reducing company-wide profits
• B)Managers of profit centers are not given any discretion in their decision making
• C)Profit centers usually require the highest degree of attention of corporate executives
• D)​A manager being rewarded on division revenues has no incentive to make good decisions for his division

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Definitions:

Capital in Excess

Funds that exceed the par value of issued stock, often referred to as additional paid-in capital or share premium.

U.S.GAAP

United States Generally Accepted Accounting Principles, a collection of rules and guidelines designed to improve and standardize accounting practices.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset since it was acquired and put into use.

Balance Sheet

A financial statement that provides a snapshot of a company’s financial condition at a specific time, including assets, liabilities, and shareholders' equity.