The correct answer is: C. Both of the above
A profit center is a business unit that is responsible for generating its own revenue and controlling its own costs. The manager of a profit center is responsible for setting prices, controlling costs, and managing the marketing and sales activities of the unit. The goal of a profit center is to generate a profit, which is the difference between revenue and costs.
A profit center is concerned with earning an adequate Return on Investment (ROI). ROI is a measure of profitability that is calculated by dividing profit by investment. A high ROI indicates that a business unit is generating a lot of profit for the amount of money that it has invested.
A profit center is also concerned with managing costs. The manager of a profit center is responsible for controlling costs in order to maximize profits. Costs can be controlled by negotiating better prices with suppliers, improving efficiency, and reducing waste.
In conclusion, a profit center is a business unit that is responsible for generating its own revenue and controlling its own costs. The manager of a profit center is responsible for setting prices, controlling costs, and managing the marketing and sales activities of the unit. The goal of a profit center is to generate a profit, which is the difference between revenue and costs. A profit center is concerned with earning an adequate Return on Investment (ROI) and managing costs.