ACCT 2230 Chapter : Managerial Accounting Chapter Eleven Notes

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14 Jan 2012

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Chapter eleven reporting for control y decentralization in organizations. In a decentralized organization decision making is spread through the organization, rather than being confined to a few top executives: decentralization and segment reporting. a cost centre is a business segment whose manager has control over costs but not over revenue or investment funds. The managers of cost centres are expected to minimized cost while providing the level of services or the amount of products demanded by the other parts of the organization: profit centre. a profit centre is any business segment whose manager has control over both cost and revenue. a profit centre manager generally does not have control over investment funds. profit centre managers are often evaluated by comparing actual profit to targeted or budgeted profit. As a result, managers are intensely interested in how transfer prices are set: three common approaches are used to set transfer prices.

Related Questions

Fill in the blanks with the phrase that best completes the sentence. Some phrases may be used more than once and some not at all.

Phrases:
cost center	revenue center
investment center	lower
profit center	higher
responsibility center

The maintenance department at the local zoo isâ a(n)

The gift shop at the local zoo isâ a(n)

The menswear department of a departmentâ store, which is responsible for buying and sellingâ merchandise, isâ a(n)

The production line at a manufacturing plant isâ a(n)

A(n) BLANK is any segment of the business whose manager is accountable for specific activities.

A division of a beverage manufacturing company responsible for a particular brand of soft drink isâ a(n)

The sales manager in charge of a shoeâ company's northwest sales territory overseesâ a(n)

Managers of cost and revenue centers are at BLANK levels of the organization than are managers of profit and investment centers.

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Management by exception Question 18 options:means that material differences will beinvestigated. means that all differences will be investigated.causes managers to be buried under voluminous paperwork. means thatonly unfavorable differences will be investigated.

Which of the following is not a true statement? Question 22 options: All costs are controllableat some level within a company. The term segment is sometimes usedto identify areas of responsibility in decentralized operations.Fewer costs are controllable as one moves up to each higher levelof managerial responsibility. Responsibility accounting applies toboth profit and not-for-profit entities. ?

Which responsibility centersgenerate both revenues and costs? Question 24 options: Investment and profitcenters Cost and investment centers Only profit centers Profit andcost centers