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Profit center definition - AccountingTools

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A profit center is a business unit or department within an organization that generates revenues and profits or losses. AccountingTools CPECourses CPECourses CPELogIn HowtoTakeaCourse StateCPERequirements Books CollegeTextbooks AccountingBooks FinanceBooks OperationsBooks CPAExamStudyGuides Articles Articles TopicsIndex SiteArchive Podcast AccountingBestPractices PodcastIndex PodcastSummary Dictionary FAQs About About Contact EnvironmentalCommitment Home AccountingTools CPECourses/CPECoursesCPELogInHowtoTakeaCourseStateCPERequirements Books/CollegeTextbooksAccountingBooksFinanceBooksOperationsBooksCPAExamStudyGuides Articles/ArticlesTopicsIndexSiteArchive Podcast/AccountingBestPracticesPodcastIndexPodcastSummary Dictionary/ FAQs/ About/AboutContactEnvironmentalCommitment Home/ AccountingTools AccountingCPECourses&Books Articles AccountingTools CPECourses/CPECoursesCPELogInHowtoTakeaCourseStateCPERequirements Books/CollegeTextbooksAccountingBooksFinanceBooksOperationsBooksCPAExamStudyGuides Articles/ArticlesTopicsIndexSiteArchive Podcast/AccountingBestPracticesPodcastIndexPodcastSummary Dictionary/ FAQs/ About/AboutContactEnvironmentalCommitment Home/ WhatisaProfitCenter?Aprofitcenterisabusinessunitordepartmentwithinanorganizationthatgeneratesrevenuesandprofitsorlosses.Managementcloselymonitorstheresultsofprofitcenters,sincetheseentitiesarethekeydriversofthetotalresultsoftheparententity.Managementtypicallyusesprofitcenterresultstodecidewhethertoallocateadditionalfundingtothem,andalsowhethertoshutdownlow-performingunits.Themanagerofaprofitcenterusuallyhastheauthoritytomakedecisionsregardinghowtoearnrevenueandwhichexpensestoincur.Profitcentersmaybeincludedinthesegmentreportingofapublicly-heldentity.Privately-heldbusinessesdonothavetoreportthisinformationaspartoftheirfinancialstatements.ProfitCentersvs.CostCentersandInvestmentCentersOthertypesofreportingentitieswithinabusinessarethecostcenterandinvestmentcenter.Acostcenterisonlyresponsibleforitscosts,whileaninvestmentcenterisresponsibleforitsreturnonassets.Intermsofresponsibilitylevel,theprofitcenterliesbetweenthecostcenterandresponsibilitycenter. Organicgrowthdefinition Revenuevariances CPECourses/CPECoursesCPELogInHowtoTakeaCourseStateCPERequirements Books/CollegeTextbooksAccountingBooksFinanceBooksOperationsBooksCPAExamStudyGuides Articles/ArticlesTopicsIndexSiteArchive Podcast/AccountingBestPracticesPodcastIndexPodcastSummary Dictionary/ FAQs/ About/AboutContactEnvironmentalCommitment Home/ AccountingTools CollegeTextbooksAccountingBooksFinanceBooksOperationsBooksCPAExamStudyGuides Sendusyoure-mailaddresstoreceivemonthlycoursediscounts * Thankyou! Copyright2022

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