As the regional manager, Ted's performance is evaluated on the difference between the sales revenues generated by his region and the cost of making those goods and services. Ted is being evaluated using:
A) a profit budget approach.
B) a revenue budget approach.
C) a cash flow budget approach.
D) a cost budget approach.
E) an expense budget approach.

Question

Quizplus · Accepted Answer

Large organizations often treat each division as a singular or stand-alone responsibility center. Corporate managers then evaluate each division's contribution to corporate performance. Managers may be evaluated on the difference between the revenues generated by the sales of goods and services and the budgeted cost of making those goods and services (a profit budget approach).

As the Regional Manager, Ted's Performance Is Evaluated on the Difference