The type of department that generates revenues and incurs costs, and its manager is responsible for the investments made in operating assets is called a:

a. profit center

b. cost center

c. service department

d. investment center

e. responsibility center

profit center            

Explanation:

A profit center refers to the business section that is handled as a different legal entity. A profit center is indeed a subdivision or tier of a corporation that contributes or is expected to contribute specifically to the whole institution's bottom-line profit margins.

It is handled practically as a distinct, independent business, responsible for producing income and dividends on budgeting balance sheets, its income and failures are calculated individually.

Profit centers are critical in deciding which units through an enterprise are by far the most and the lowest productive, acting as a way of distinguishing between some revenue-generating operations.

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