A responsibility accounting system:
A) Is designed to measure the performance of managers in terms of uncontrollable costs.
B) Assigns responsibility for costs to the top managerial level.
C) Is designed to hold a manager responsible for costs over which the manager has no influence.
D) Can be applied at any level of an organization.
E) Is well suited to work in an environment without clear lines of responsibility and authority.

Question

Quizplus · Accepted Answer

A responsibility accounting system can be applied at any level of an organization. It is used to assign responsibility for costs and measure the performance of managers in terms of controllable costs. It is not designed to hold a manager accountable for costs over which they have no influence. It is also not limited to the top managerial level. It is best used in an environment with clear lines of responsibility and authority.

A Responsibility Accounting System