Responsibility Centres

Ctrl Revenue & Cost, but Not Lv of Investment

Eg Burger King franchise, cost & rev still can be ctrl by branch m'ger somehow

Evaluate - Broad Index of performance

Corporate Decision

Local Decision

Ctrl cost, Revenue & Level of INvestment

Evaluate - Return on Investment

Ctrl cost & reduce cost of manu operN, service Opn

Evaluate Performance

Compare Actual vs Target or Std cost

Interperiod cost comparison - Constant mx of pdt & pdtN Lv

Unmeasurable attributes

Quality

Response time

Staff motivation

Customer service

Ctrl Revenue, Price, Mix of stock on hand, promotion

Evaluate performance

Revenut it generate - traceable cost = net revenue

Increase incentive for staff to create cost to Increase rev