Responsibility centers and reporting segments
Free IMA CMA Part 1 (Financial Planning, Performance, and Analytics) lesson in Performance Management. 17 min read, ~2,612 words.
Four responsibility centers: cost (inputs only), revenue (sales only), profit (revenues minus controllable costs), investment (profit plus assets used, measured by ROI / RI / EVA). Contribution margin = sales minus variable costs; segment margin = contribution margin minus traceable fixed costs (the right number for keep-or-drop). Common cost allocation...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- 1C2
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