Evaluation of the performance of managers of profit centers assumes that the managers can control or influence both costs and revenue generation.

Question

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The evaluation of performance of managers of profit centers is based on the assumption that they have the ability to control or influence both costs and revenue generation. This is because profit centers are responsible for generating profits and managing all aspects of their operations, including costs and revenue. Profit center managers have the authority to make decisions that affect both costs and revenue, such as pricing strategies, sales promotion, cost reduction efforts, and resource allocation. Therefore, their performance is evaluated based on their ability to effectively manage costs and increase revenue, and ultimately, their contribution to the overall profitability of the organization.

Evaluation of the Performance of Managers of Profit Centers Assumes