Demarcus and his brother of the organization is being evaluated based on the following financial results and variances for last month. From the four choices provided, which type of responsibility center do you think this performance evaluation approach reflects? Explain why

A. Revenue center 

B. Profit center 

C. Investment center 

D. Cost center

Transcribed Image Text:

Flexible Budget Flexible Variance % of Variance Demarcus bubunit Actual Direct materials Direct labor Indirect labor Utilities Depreciation Repairs and Maintenance Total $30,000 15,000 25,000 12,000 25,000 Budget $28,000 14,000 22,000 10,000 25,000 (U or F) $2,000 U 1,000 U 3,000 U 2,000 U (U or F) 7.14% U 7.14% U 13.64% u 20.0% U 4,000 $111,000 5,000 $104,000 1,000 F $7,000 U 20.00% F 6.73% U Flexible Budget Flexible Variance % of Variance Demarcus bubunit Actual Direct materials Direct labor Indirect labor Utilities Depreciation Repairs and Maintenance Total $30,000 15,000 25,000 12,000 25,000 Budget $28,000 14,000 22,000 10,000 25,000 (U or F) $2,000 U 1,000 U 3,000 U 2,000 U (U or F) 7.14% U 7.14% U 13.64% u 20.0% U 4,000 $111,000 5,000 $104,000 1,000 F $7,000 U 20.00% F 6.73% U

Answer rating: 100% (QA)

D Cost center EXPLANATION A responsibi... View the full answer