If a segment of business is considered a profit center:

Question

Quizplus · Accepted Answer

A profit center is a business segment that generates revenue and incurs costs, hence both revenue and cost data must be accumulated for the segment. Option A is incorrect as a profit center can sell products or services to both internal and external customers. Option B is incorrect as revenue alone does not provide a complete picture of the profitability of the segment. Option C is incorrect as indirect expenses can be allocated to the profit center to determine its profitability.

If a Segment of Business Is Considered a Profit Center