In responsibility accounting,a center's performance is measured by those costs which are controllable.Controllable costs are best described as including: (CMA adapted)
A) direct materials and direct labor only.
B) only those costs that the manager can influence in the current period.
C) only discretionary costs.
D) those costs about which the manager is knowledgeable and informeD.
A controllable cost is one that can be influenceD.

Question

Quizplus · Accepted Answer

Controllable costs are those costs that can be influenced by the manager in the current period, such as expenses for salaries, supplies, and maintenance. Direct materials and direct labor are not the only controllable costs as they can also be influenced by factors outside the control of the manager, such as changes in market prices or production processes. Discretionary costs are also controllable, but not all controllable costs are discretionary. The manager must also have knowledge and information about the cost in order to be able to influence it.

In Responsibility Accounting,a Center's Performance Is Measured by Those Costs