Question

ABC Software operates stores within five regions. Regional managers are held accountable for marketing, advertising, and sales decisions, and all costs incurred within their region. In addition, regional managers decide whether new stores will open, where the stores will be located, and whether the stores will lease or purchase the facilities. Store managers, in contrast, are accountable for marketing, advertising, and sales decisions, and costs incurred within their stores. Ideally, on the basis of this information, what type of responsibility center should the software company use to evaluate its regions and stores

Answer 1

Answer:

The type of responsibility center ABC software company can use to evaluate its regions and stores is called Investment Center.

Explanation:

An investment center is a responsibility center that handles, revenues, expenses as well as investment base.

This kind of responsibility center is appropriate for large companies like ABC software.

It is designed to cater for the different regions and stores as well as the product specifications and managerial responsibilities.

It is applicable for companies with regional mangers and store managers that take decisions on which stores to open, marketing plan, advertising, sales, accounting and financial decisions.