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ACC281Week 5 DQ 1 Responsibility Centers.doc

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Responsibility Centers - Week 5
From Chapter 15 complete question 3, page 550, on responsibility centers. Use your text and one
additional source. You must respond to at least two of your other classmates' postings to receive
full credit.
The definition of Responsibility Center; an organizational unit that controls
identifiable revenue or expense items. There are three categories of Responsibility
Centers: cost center, profit center, and investment center (Edmonds, 2010 pg. 532).
For the accounting performance measurement systems the Responsibility accounting
is an essential concept.
A associate degree structure unit that incurs expenses however doesn't generate
revenue is called as cost center.
Profit center not solely acquires prices however it conjointly produces revenue.
Managers that are blame of a profit center are judged on their ability to
supply revenue additionally to prices.
Managers of investment centers ar answerable for assets and liabilities furthermore as
earnings. (Edmonds, T) Investment center managers are accountable
for each profit and also the assets employed in generating profit. Thus, associate
degree investment center adds a lot of to a manager's scope of responsibility
than will a profit center,even as a profit center involves quite a value center.
Investment center managers ar generally evaluated in terms ofcome
back on plus (Edmonds, 2010 pg.550)
cost normally falls on the lower levels of the organization charts because Cost
differs from profit and investment (Edmonds, 2010 pg. 550). Which clearly show that
the absence of revenue and also be said that the absence of control over revenue
generation. With profit, the manager is judged on the ability to produce revenue in
excess of expenses (Edmonds, 2010 pg.550). Profits produced from operations, and
the cash dividends paid during the accounting period. The statement of cash flows
divides receipts and payments of cash into three categories. The section on operating
activities show the cash effects of transactions that creates revenue and expenses. It
shows what cash is received from the company operations, and provides a good
measure for the company’s ability to generate cash for growth and profitability.
Managers of investment centers are accountable for assets and liabilities as well as
earnings. (Edmonds, 2010 pg.550) Investment center managers are responsible for
both profit and the assets used in generating profit. An investment center adds more to
a manager's range of responsibility than a profit center also same as a profit center
includes more than a cost center. Investment center managers are typically evaluated
in terms of return on assets. Responsibility centers are decentralized businesses that
are usually split up into individual reporting units (Edmonds, 2010 pg. 550).
Stephani Dayton
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Responsibility Centers - Week 5 From Chapter 15 complete question 3, page 550, on responsibility centers. Use your text and one additional source.?You must respond to at least two of your other classmates' postings to receive full credit. ?The definition of Responsibility Center; an organizational unit that controls identifiable revenue or expense items. There are three categories of Responsibility Centers: cost center, profit center, and investment center (Edmonds, 2010 pg. 532). For the accounting performance measurement systems the Responsibility accounting is an essential concept. ???? ?A ...
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