Which items does a profit center manager have responsibility over?

Which items does a profit center manager have responsibility over?

• A. Costs, revenues, and profits
• B. Only costs
• C. Only revenues
• D. Only assets

Answer: (A)

A profit center manager is judged on profitability, so the manager is responsible for both generating revenue and controlling costs. By having authority over pricing, sales volume, and cost management, the manager can affect the income and the expenses to deliver profit for the unit. Assets are typically not managed at the profit-center level, which is why only costs or only revenues wouldn’t fully capture the manager’s scope. Therefore, the manager oversees costs, revenues, and the resulting profit.

A profit center manager is judged on profitability, so the manager is responsible for both generating revenue and controlling costs. By having authority over pricing, sales volume, and cost management, the manager can affect the income and the expenses to deliver profit for the unit. Assets are typically not managed at the profit-center level, which is why only costs or only revenues wouldn’t fully capture the manager’s scope. Therefore, the manager oversees costs, revenues, and the resulting profit.