A distinction should be made between controllable and noncontrollable costs when reporting information under responsibility accounting.

Question

Quizplus · Accepted Answer

This is because controllable costs are costs that can be directly influenced by a manager, while noncontrollable costs are costs that cannot be influenced due to factors outside of the manager's control. It is important to report these separately when using responsibility accounting to evaluate a manager's performance.

A Distinction Should Be Made Between Controllable and Noncontrollable Costs