Identify and describe the five different responsibility centers, and provide one example of each
Cost Center: A responsibility center whose manager is accountable only for controllable costs that have well-defined relationships between the center's resources and products or services. Example: Ford Motor Company's Detroit assembly line
Discretionary Cost Center: A responsibility center whose manager is accountable for costs only and in which the relationship between resources and products or services produced is not well defined. Example: The Human Resources Department of Merck & Co.
Revenue Center: A responsibility center whose manager is accountable primarily for revenue and whose success is based on its ability to generate revenue. Example: Avis Car Rental's national reservation center
Profit Center: A responsibility center whose manager is accountable for both revenues and costs and for the resulting operating income. Example: The local Wal-Mart store
Investment Center: A responsibility center whose manager is accountable for profit generation and who can also make significant decisions about the resources the center uses. Example: The president of General Motors (The "company" is the investment center, and the president is the "manager.")
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Failure to record the supplies used during the year would result in which of the following?
a. Net income being understated b. An overstatement of liabilities c. Stockholders' equity being overstated d. Total assets being understated
The entry to record payment of a $3,000 purchase within the 2 percent discount period would include a(n)
A) decrease to Accounts Payable for $2,940. B) increase to Purchases Discounts for $60. C) increase to Accounts Payable for $3,000. D) increase to Cash for $3,000.
A project’s completion time variance is calculated by?
a. Summing the variances of the critical path activities b. Multiplying the variances of the critical path activities c. Multiplying the variances of all of the project activities d. Summing the variances of all of the project activities
To be valid, a noncompete clause must be:
a. ancillary to a legitimate bargain. b. reasonable in time, geographical area, and scope of activity when ancillary to the sale of a business. c. necessary to protect trade secrets, confidential information, or customer lists developed over an extended time when ancillary to an employment contract. d. All of the above.