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Cost Center & Profit Center ( Distinguish )

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krissun (Querist)
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20 May 2010 VERY URGENT

Dear Friends,

could anybody explain me about the technical/accounting/end-to-end relationship of "Cost center & Profit center"

Would appreciate,if answered,with a better practical example in BPO Accounting set-up and help me in visualising the P&L and B/S ?

thanks in adv.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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20 May 2010
Profit centre is Line of Business ( which gives the revenue to the business Suppose a BPO handling Accounts, Taxation, Insurance,Pay roll processing each division can be tracked separate profit centre and identify revenue for the Each separately

Cost centre are which the centre formed for tracking the expenses based on the relationship with profit centre. it can be direct related cost centre and shared services like Finance & accounts, Administration

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