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  • Responsibility Centers

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    Astronomy Spacefield
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    This document outlines various responsibility centers used to evaluate performance including cost centers, profit centers, revenue centers, and investment centers. It defines key metrics like segment contribution margin, segment income/margin, return on investment, residual income, and economic value added (EVA) which are used to measure performance at different levels of the organization.

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    RESPONSIBILITY CENTERS

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    This document outlines various responsibility centers used to evaluate performance including cost centers, profit centers, revenue centers, and investment centers. It defines key metrics like segment contribution margin, segment income/margin, return on investment, residual income, and economic value added (EVA) which are used to measure performance at different levels of the organization.

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    © All Rights Reserved
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    7 views1 page

    Responsibility Centers

    Uploaded by

    Astronomy Spacefield
    This document outlines various responsibility centers used to evaluate performance including cost centers, profit centers, revenue centers, and investment centers. It defines key metrics like segment contribution margin, segment income/margin, return on investment, residual income, and economic value added (EVA) which are used to measure performance at different levels of the organization.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 1

    RESPONSIBILITY CENTERS

    Cost Center
    Profit Center
    Segment Contribution Margin Total Revenues – Total Variable Cost

    Segment Income/Margin Segment Contribution Margin – Avoidable Fixed Cost

    Net Operating Income + Common Fixed Cost


    Revenue Center
    Investment Center
    Operating Income / Average Investment or Assets
    Return on Investment Operating Income × Sales
    Sales Average Investment or Assets
    Residual Income Operating Income – (minimum ROR × Average Investments/Assets)

    Economic Value Added (EVA) EBIAT – (WACC × Total Long-Term Sources of Financing)

    NOPAT – (Total Assets – Current Liabilities) × WACC

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