24.1   Learning Objective 24-1

 

1) A profit center is a unit in which the manager:

A) has the responsibility for controlling costs, but not for directly generating revenue.

B) is not responsible for controlling costs, but is responsible for generating revenue.

C) is responsible for controlling costs and generating revenue.

D) None of these answers are correct.

 

2) In a cost center, the manager:

A) has the responsibility for controlling costs, but not directly generating revenue.

B) is not responsible for controlling costs, but is responsible for generating revenue.

C) is responsible for controlling costs and generating revenue.

D) None of these answers are correct.

 

3) Departmental reports are useful for all of the following purposes except:

A) determining performance.

B) determining future revenue.

C) controlling.

D) planning.

 

4) Normally, the report prepared for a department is a(n):

A) cash flow statement.

B) statement of equity.

C) income statement.

D) balance sheet.

5) A maintenance department would be an example of a:

A) cost center.

B) direct expense.

C) profit center.

D) None of these answers are correct.

 

6) In a department store, the men’s clothing section would be a(n):

A) profit center.

B) direct expense.

C) cost center.

D) indirect expense.

 

7) A unit or department that incurs costs and generates revenues is a(n):

A) expense center.

B) direct center.

C) cost center.

D) profit center.

 

8) The financial statement(s) that can be broken down by departments would be:

A) income statement.

B) balance sheet.

C) statement of owner’s equity.

D) All of these answers are correct.

9) The administrative department of a mall is a(n):

A) cost center.

B) profit center.

C) investment center.

D) revenue center.

 

10) The sales department of a construction firm is a(n):

A) profit center.

B) cost center.

C) investment center.

D) allocation center.

 

 

 

 



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *