Identify types of responsibility centers (Learning Objective 5)

Identify each responsibility center as a cost center, a revenue center, a profit center, or an investment center.

a. The bakery department of a Publix supermarket reports income for the current year.

b. Pace Foods is a subsidiary of Campbell Soup Company.

c. The personnel department of State Farm Insurance Companies prepares its budget and subsequent performance report on the basis of its expected expenses for the year.

d. The shopping section of Burpee.com reports both revenues and expenses.

e. Burpee.corn’s investor relations Web site provides operating and financial information to investors and other interested parties.

f. The manager of a BP service station is evaluated based on the station’s revenues and expenses.

g. A charter airline records revenues and expenses for each airplane each month. Each airplane’s performance report shows its ratio of operating income to average book value.

h. The manager of the southwest sales territory is evaluated based on a comparison of current period sales against budgeted sales.