How Is Performance Evaluated for a Cost Center

question 58

Multiple Choice

How is performance evaluated for a cost center?

• A) Actual costs incurred compared to budgeted costs.
• B) Actual segment margin compared to budgeted segment margin.
• C) Comparison of actual and budgeted return on investment (ROI) based on segment margin and assets controlled by the segment.
• D)None of the above.

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Definitions:

Held-to-maturity Securities

Financial instruments that a company has the intent and ability to hold until they mature.

Interest Revenue

Income earned from lending funds or investing in interest-bearing financial instruments.

Fair Value Adjustment

An accounting practice of updating the book value of assets and liabilities to reflect their current market values.

Adjunct Asset

An addition to an asset that increases its value, often for accounting or tax purposes.