Profit Center Accounting
This component is used for working out the operating profit of profit centers, using either the period or cost-of-sales accounting procedures. By assigning the invested capital to profit centers, you can also use them as investment centers. Dividing a company into profit centers enables you to perform controlling for various departments, which then assume responsibility for their own profitability.
You can assign profit centers to the following objects:
You will need this component if you have to work out the profit made during a particular period by a specific area of your business, and if you want to use this analysis for controlling your business activities or evaluating their profitability. To a certain extent, profit center managers operate as independent entrepreneurs, which motivates them to produce the best possible results for their areas.