Responsibility accounting performance reports are prepared by which types of business units?
A) Cost centers only
B) Investment centers and revenue centers only
C) Cost centers, revenue centers, and profit centers
D) Investment centers only

Question

Quizplus · Accepted Answer

Responsibility accounting performance reports are prepared by cost centers, revenue centers, and profit centers. Cost centers are responsible for controlling and monitoring costs, revenue centers are responsible for generating revenue, and profit centers are responsible for both generating revenue and controlling costs. Investment centers are also responsible for generating revenue and controlling costs, but they also have the additional responsibility of managing invested capital, making them a subset of profit centers.

Responsibility Accounting Performance Reports Are Prepared by Which Types of Business