anu

• Jul 25th, 2006

 

profit center accounting is basicaly done for internal controlling purposes.It lets you determine the profit and loss using the cost of sale approach or period accounting approach.here you can find the profit from an "area of reponsibility or pserson" point of view.this is accound based costing

whereas in Profitability analysis, market segments based on product , cutomer,order aor any comobination of these are studied to find wots the profit.PA provides information to the marketing,sales and planning department so that they can make decisions.PA  has two forms account based and CO based.

both these are tools for profit managment, and both are alternative.they are not same.

anu

• Aug 21st, 2006

 

In my above answers along with a few spell chks I would like to point out one of my mistakes in the last statment that ...

Profit centre accounting and profitability analysis are NOT ALTTERNATIVES.

THANKS.