In a product structure,each product is treated as a ________; that is,the expenses related to a product are subtracted from the revenues generated by selling it.
A) profit center
B) cost center
C) core competency
D) functional division

Question

Quizplus · Accepted Answer

In a product structure, each product is treated as a profit center because the expenses related to a product are subtracted from the revenues generated by selling it, and the resulting figure is the profit or loss generated by that product. This helps in assessing the profitability of each product and making decisions regarding investments, pricing, and production levels. Cost center refers to any unit or department within an organization that is responsible for incurring costs but does not generate revenues directly. Core competency refers to a unique strength or expertise that sets an organization apart from its competitors, and functional division refers to the grouping of similar tasks or activities within an organization.

In a Product Structure,each Product Is Treated as a ________;