The term responsibility center reflects the idea that the "centers" of a business usually are defined in a manner such that each center is:

Select one:

a. Responsible for earning a specified amount of profit.

b. Responsible for all business operations in a specific region.

c. Under the control of a specified center manager.

d. Approximately the same size.

In preparing a responsibility income statement that shows contribution margin and responsibility margin, generally two concepts are involved in allocating costs to the various centers. These concepts are:

Select one:

a. Whether the costs are variable or fixed and whether they are material in dollar amount.

b. Whether the costs are traceable to the responsibility center and whether the responsibility center is organized as a profit center or an investment center.

c. Whether the costs are variable or fixed and whether they are directly traceable to the responsibility center.

d. Whether the costs are traceable to the responsibility center and whether they are material in dollar amount.

The most common value used for transfer pricing is:

Select one:

a. Total fixed costs.

b. Total fixed and variable costs.

c. Market value less fixed costs.

d. Market value.