A Unit of an Organization Is Referred to as a Profit

question 114

Multiple Choice

A unit of an organization is referred to as a profit center if it has:

• A) Authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply.
• B) Authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply, and significant control over the amount of invested capital.
• C) Authority to make decisions over the most significant costs of operations, including the power to choose the sources of supply.
• D) Authority to provide specialized support to other units within the organization.
• E) Responsibility for combining material, labor, and other factors of production into a final output.

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Definitions:

Existence

The state or fact of living or having objective reality.

Initial

Pertaining to the beginning, first, or early stages of a process or series.

Management

The process of planning, organizing, leading, and controlling resources in order to achieve the goals of an organization.

Available Resources

The tangible and intangible assets that a company or an individual possesses, which can be utilized to achieve goals, including financial, human, technological, and natural resources.