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A subunit that has responsibility for controlling costs but does not have responsibility for generating revenue is a

A subunit that has responsibility for controlling costs, but does not have responsibility for generating revenue is a(n)

A.investment center.

B.cost center.

C.profit center.

D.value added center.

 

43.Which of the following units of Walmartwillmost likely be a cost center?

A.AWalmartstore in Dallas, Texas

B.The corporate payrolldepartment

C.The pharmacy department

D.The optical department

 

44.Most service departments, such as machine maintenance and janitorial services, are examples of

A.investment centers.

B.profit centers.

C.cost centers.

D.transfer centers.

 

45.If responsibility centers are ranked in order of increasing responsibility, the ranking is

A.investment centers, cost centers, profit centers.

B.cost centers, investment centers, profit centers.

C.cost centers,profit centers, investment centers.

D.investment centers, profit centers, cost centers.

 

46.Which of the following is a characteristic of a profit center?

A.The center’s manager has control over revenues and costs.

B.The subunit has responsibility for generating revenues, controlling costs, and generating a return on assets.

C.The subunit can be evaluated usingresidual income.

D.The subunit can be evaluated by comparing it to other investment centers.

 

47.A manager who has the ability to replace assets within his division, is in control of what type of center?

A.Business center

B.Profit center

C.Cost center

D.Investment center

 

48.The Cadillacdivision of General Motors is considered

A.a profit center.

B.an investment center.

C.a cost center.

D.a center that will be evaluated on profit margin.

 

49.Which of the following is a responsibility that distinguishes an investment center manager from a profit center manager?

A.Setting prices for products

B.Controlling costs

C.Generating revenues while controlling costs

D.Significantly influencing investment decisions

 

50.What does ROI measure?

A.The amount of profit generated out of each sales dollar

B.The amount of sales generated out of each dollar of assets invested

C.The amount of profit generated out of each dollar of assets invested

D.The amount of revenue generated out of each sales dollar

 

 

Jan 24 2020 View more View Less

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