Not-for-profit entities
A) do not use responsibility accounting.
B) utilize responsibility accounting in trying to maximize net income.
C) utilize responsibility accounting in trying to minimize the cost of providing services.
D) have only noncontrollable costs.

Question

Quizplus · Accepted Answer

Not-for-profit entities utilize responsibility accounting in trying to minimize the cost of providing services. While they do not have a profit-maximizing objective, they still aim to provide efficient and effective services to their beneficiaries. As such, they may use responsibility accounting to allocate costs to different programs or departments and to monitor their performance in terms of cost efficiency.

Not-For-Profit Entities