1 Why is it difficult to assess the effectiveness of discretionary cost centers?

1 Why is it difficult to assess the effectiveness of discretionary cost centers?2 A superior criticized a sales manager for selling high-revenue, low-profit items instead of lower-revenue but higher profit items. The sales manager responded, “My income is based on commissions that are a percent of revenues. Why should I care about profits? I care about revenues!” Comment.

1. Discretionary cost centers are the cost centers, which does not have clearedrelationship between the effort and accomplishment. Since the relationship betweeneffort and accomplishment is…

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