Question

42. The main difference between profit centre and investment centre is:
(A) Decision making
(B) Revenue generation
(C) Incurrence
(D) Investment​

Answer 1

Answer:

b ) revenue generation

Explanation:

because the main difference profit centre and investment centre is to revenue generation

Answer 2

The main difference between a profit center and an investment center is investment. (Option D)

• A profit center is a standalone division or department of an enterprise that is involved in cost-related decision-making and revenue generation.
• An investment center is also a profit center that deals with both decision making and revenue generation, but along with that, it is also responsible for making investments.
• Therefore, it is the additional task of investment making that makes investment centers different from profit centers.
• Also, the intervention of top management is very low in the investment center, when compared to the profit center.
• In the investment center, the divisional managers have more authority than the top managers.