Question

Dormer Corporation manufactures windows with wood and metal frames. Dormer has three departments: glass, wood, and metal. The glass department makes the window glass and sends it to either the wood or metal department where the glass is framed. The window is then sold. Upper management sets the production schedules for the three departments and evaluates them on output quantity, cost variances, and product quality.

Required
1. Are the three departments cost centers, revenue centers, or profit centers?
2. Are the three departments centralized or decentralized?
3. Can a centralized department be a profit center? Why or why not?



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  • CreatedJanuary 15, 2015
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