A Fully-Owned Subsidiary of a Multinational Company Reports Its Return

question 70

Multiple Choice

A fully-owned subsidiary of a multinational company reports its return on investment (ROI) periodically during the year. This unit of the company, for performance evaluation purposes, is likely considered a(n) :

• A) Profit center.
• B) Revenue center.
• C) Cost center.
• D) Operating center.
• E) Investment center.

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Definitions:

Unamortized Patent

The cost of a patent that has not yet been gradually written off as an expense over its useful life.

Adjustment Necessary

A modification or change required to correct or update financial records and statements to accurately reflect the financial status of an entity.

Equity Income

Refers to the income generated by an investor's share of profits from an equity investment, such as stocks or ownership interests in companies.