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A profit center is a section of a company treated as a separate business. Thus profits or losses for a profit center are calculated separately. A profit center manager is held accountable for both revenue and costs (expenses), and therefore for profits.
A responsibility center is an organizational unit headed by a manager, who is responsible for its activities and results. [1] In responsibility accounting, revenues and cost information are collected and reported on by responsibility centers.
A strategic business unit (SBU) in business strategic management, is a profit center which focuses on product offering and market segment. SBUs typically have a discrete marketing plan , analysis of competition, and marketing campaign , even though they may be part of a larger business entity.
A cost centre is a department within a business to which costs can be allocated. The term includes departments which do not produce directly but they incur costs to the business, [1] when the manager and employees of the cost centre are not accountable for the profitability and investment decisions of the business but they are responsible for some of its costs.
Revenue centers only measure the output (in fiscal standings) and are therefore marketing establishments which are exempt from profit generation and accountability thereof. [4] In a revenue center performance is measured by comparing actual sales to projected ones (as well as number of sales or revenue per time scale).
Therefore, economic profit is smaller than accounting profit. [3] Normal profit is often viewed in conjunction with economic profit. Normal profits in business refer to a situation where a company generates revenue that is equal to the total costs incurred in its operation, thus allowing it to remain operational in a competitive industry.
And unfortunately, the two are not separable,” Ivanka, 43, said, adding it is a “very dark, negative business.” Ivanka Trump has revealed why she won’t be returning to the White House for ...
An investment center is a classification used for business units within an enterprise. The essential element of an investment center is that it is treated as a unit which is measured against its use of capital, as opposed to a cost or profit center, which are measured against raw costs or profits.