The primary difference between profit centers and cost centers is that:
A)Profit centers generate revenue.
B)Cost centers incur costs.
C)Profit centers are evaluated using return on investment criteria.
D)Profit centers provide services to other centers in the organization.

Question

Quizplus · Accepted Answer

Profit centers generate revenue, while cost centers incur costs. Profit centers are evaluated based on their ability to generate profits for the organization, often using return on investment criteria. Cost centers, on the other hand, are evaluated based on their ability to control costs and provide necessary services or support to other areas of the organization.

The Primary Difference Between Profit Centers and Cost Centers Is