A Manager of a Revenue Center Is Responsible ________

question 46

Multiple Choice

A manager of a revenue center is responsible ________.

• A) for only the profits of his center
• B) for investments, revenues, and costs
• C) for only the revenues of his center
• D) for both, the revenues and costs of his center

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Definitions:

Variable Component

The portion of costs or expenses that varies directly with changes in production volume or business activity.

Fixed Component

The portion of a cost or expense that remains constant regardless of the level of production or business activity.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products or job orders, based on a chosen activity base.

Variable Component

A portion of a cost or expense that varies directly with the level of activity or production volume.