ECONOMICS

Detailed explanation-1: -A profit center is a center that generates revenues, profits, and costs.

Detailed explanation-2: -Revenue center is considered as the sales department in the company, whose manager has the authority to decide on the size and direction of sales and has powers to negotiate the sales price, payment terms and delivery schedule.

Detailed explanation-3: -A revenue center is a distinct operating unit of a business that is responsible for generating sales. For example, a department store may consider each department within the store to be a revenue center, such as men’s shoes, women’ shoes, men’s clothes, women’s clothes, jewelry, and so forth.

Detailed explanation-4: -A cost center is a collection of activities tracked by a company that do not generate any revenue. An example of a cost center is the accounting team within an organization. This center of activity is different from a profit center in which a profit center does generate both revenues and expenses.

Detailed explanation-5: -Example #3: Hotel revenue centers Bars and lounges. Cafes. Room service. Meeting and banqueting facilities.