A Responsibility Center in Which the Department Manager Is Responsible

question 188

Multiple Choice

A responsibility center in which the department manager is responsible for costs, revenues, and assets for a department is called:

• A) a cost center
• B) a profit center
• C) an operating center
• D) an investment center

---

Definitions:

Service Department Cost

Involves the expenses associated with the departments that do not directly produce goods but provide support or services to other departments within an organization.

ABC Corporation

A hypothetical or generic naming convention used to represent a company in examples or case studies.

Net Income

The amount of money a company keeps as profit once all taxes and expenses are deducted from its total income.

Accounting Records

Documents and ledgers that record financial transactions and the financial position of an entity, serving as the basis for financial reporting and analysis.