The Difference Between a Profit Center and an Investment Center

question 114

Multiple Choice

The difference between a profit center and an investment center is

• A)An investment center incurs costs,but does not directly generate revenues.
• B)An investment center incurs no costs but does generate revenues.
• C)An investment center is responsible for investments made in operating assets.
• D)An investment center provides services to profit centers.
• E)There is no difference; investment center and profit center are synonymous.

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Definitions:

Parol Evidence Rule

a legal principle that prevents the parties of a written contract from presenting extrinsic evidence of terms of the agreement that contradict, modify, or vary contractual terms.

Main Purpose

The primary objective or aim intended to be achieved by something or someone.

Collateral Contract

A secondary agreement made in addition to a primary contract, which induces a party to enter into the primary contract.

Leading Object Rule

A legal principle in contract law used to determine whether a promise is enforceable under the Statute of Frauds.