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.

Question

Quizplus · Accepted Answer

Cost centers have the least amount of responsibility as their main goal is to control costs. Profit centers have more responsibility as they are responsible for generating revenue and controlling costs. Investment centers have the most responsibility as they not only generate revenue and control costs but also make investment decisions. Therefore, the ranking in order of increasing responsibility is cost centers, profit centers, and investment centers.

If Responsibility Centers Are Ranked in Order of Increasing Responsibility