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11 a responsibility income statement shows the revenue and expenses of each cost cen 4298294

 

11. A responsibility income statement shows the revenue and expenses of each cost center within a particular part of a business. 
 

 

12. The contribution margin approach to preparing reports for managers classifies costs into fixed and variable costs. 
 

 

13. A cost that is directly traceable to a particular center must be a variable cost. 
 

 

14. The responsibility margin is the contribution margin less common fixed costs. 
 

 

15. Common fixed costs jointly benefit several parts of the business and would not change significantly even if one of the parts of the business were discontinued. 
 

 

16. A common cost may become a traceable cost as it moves up to larger responsibility centers. 
 

 

17. Performance margin is equal to controllable fixed costs minus the contribution margin. 
 

 

18. An investment center is a profit center where management can make related capital investment choices. 
 

 

19. Revenue, less variable costs, less traceable fixed costs, is called the contribution margin. 
 

 

20. In responsibility income statements, revenue is first assigned to the centers responsible for creating that revenue. 
 

 

21. In assigning costs to centers, each center is charged with costs attributed to the center and based on company-wide rates. 
 

 

22. If operations at a center are discontinued, all traceable costs attributed to the cost would be discontinued. 
 

 

 

 

 

 

 

 

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