Question 1
A manager of a profit center
cannot◦ set the selling price of the center's product.
◦ commit funds to invest in assets.
◦ control the center for which he or she is responsible.
◦ incur cost to operate the center.
Question 2
A profit center manager's performance is typically measured based on the unit's
◦ overall profit compared to the flexible budget.
◦ ROI.
◦ costs incurred.
◦ direct material and direct labor variances only.