A segment of Syntex, Inc. manufactures and sells blankets. The various models of blankets are produced in a single factory using stable technology. They are sold by the sales department, which is also located in the factory. What centre is most probably used to account for this segment?
A) a cost centre
B) a profit centre
C) a revenue centre
D) an investment centre

Question

Quizplus · Accepted Answer

Since the segment produces and sells blankets, it is likely that it is being managed as a profit center. The sales department within the factory can also be a part of the profit center as it contributes to the revenue generated by the blankets. As a profit center, management will be focused on maximizing profits and controlling costs.

A Segment of Syntex, Inc