The difference between a profit center and an investment center is
A) an investment center incurs costs, but does not directly generate revenues.
B) an investment center incurs no costs but does generate revenues.
C) an investment center is responsible for effectively using center assets.
D) an investment center provides services to profit centers.
E) There is no difference; investment center and profit center are synonymous.

Question

Quizplus · Accepted Answer

A profit center is responsible for generating revenue and controlling costs, while an investment center is responsible for effectively using center assets to generate a return on investment. Therefore, the key difference between the two is that an investment center focuses more on making strategic investments and managing assets, while a profit center focuses more on generating revenue and controlling costs.

The Difference Between a Profit Center and an Investment Center