Financial & Managerial Accounting 17th Edition by Jan Williams ,Susan Haka,Mark Bettner,Joseph Carcello

تمرين 25

Types of Responsibility Centers and Basis for Evaluation
Listed below are parts of various well-known businesses:
1. The bookstore of Central Michigan University.
2. The billing department of Jackson Life Insurance Co.
3. The San Francisco Factory of Ghirardelli Chocolates.
4. The textiles and rugs department of IKEA.
5. The gift shop at the Museum of Science and Industry.
6. The legal department of Walmart.
Indicate whether each part represents an investment center, a profit center (other than an investment center), or a cost center. Why are business organizations divided into responsibility centers? Explain how revenue and costs are assigned to a responsibility center using a responsibility center income statement.