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Point 1: The decision-making authority assigned to managers within the different responsibility centers (cost, profit and investment) will differ based on the type of center because the role of management's responsibilities also differs. Therefore, the accounting information required for planning, control, and performance evaluation differs according to the nature of these responsibilities.
In 400-600 words address the following:
Question 1: Distinguish among a cost center, a profit center, and an investment center. Provide an example of each for a multi-hospital corporation.
Question 2: What are some of the uses that management may make of accounting information about individual responsibility centers of the business?
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