Decentralized organizations can delegate authority and still maintain control and monitor managers' performance by designing appropriate management control systems. Which of the following responsibility centers would be evaluated similar to an independent business? (CMA, adapted)
A) Profit center.
B) Revenue center.
C) Investment center.
D) Discretionary cost center.

Question

Quizplus · Accepted Answer

An investment center is evaluated similar to an independent business because it is responsible for its own revenues, expenses, and investments, allowing it to be assessed based on its return on investment.

Decentralized Organizations Can Delegate Authority and Still Maintain Control and Monitor