A responsibility center which measures performance in terms of the difference between revenues (which measure production) and expenditures (which measure resources) is a(n)
A) investment center.
B) revenue center.
C) expense center.
D) profit center.
E) standard cost center.

Question

Quizplus · Accepted Answer

A profit center measures its performance in terms of the difference between revenues and expenditures, which is profit. Therefore, a profit center is the responsibility center that is being described in this question.

A Responsibility Center Which Measures Performance in Terms of the Difference