The performance evaluation of a cost center is typically based on its:
A)static budget variance.
B)flexible budget variance.
C)return on investment.
D)sales volume variance.

Question

Quizplus · Accepted Answer

The evaluation of a cost center is typically based on its flexible budget variance, which compares actual costs to the flexible budget (which adjusts for actual activity levels). This allows for a more accurate assessment of performance, as it takes into account any changes in activity levels that may have affected the cost center's performance. The other options listed are not typically used to evaluate a cost center's performance.

The Performance Evaluation of a Cost Center Is Typically Based