Listed below are parts of various well-known businesses:
1. The bookstore of Northern Jersey University.
2. The billing department of Rhode Island Life Insurance Co.
3. The Norwalk Factory of Melvin’s Chocolates.
4. The jewelry department of Bloomingdale’s.
5. The gift shop at the Museum of Natural History.
6. The legal department of Sears.
Indicate whether each part represents an investment center, a profit center (other than an investment center), or a cost center. Why are business organizations divided into responsibility centers? Explain how revenue and costs are assigned to a responsibility center using a responsibility center income statement.