Difference between an investment center and a profit center

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Reference no: EM13920858

The Jameson Company has recently formed a subsidiary, Bright Ideas, to manufacture and sell household appliances.

a. What is the difference between an investment center and a profit center?

b. What factors should Jameson consider in deciding whether to evaluate Bright Ideas as a profit or investment center?

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The debate on how to improve corporate governance continues in the aftermath of the 2001-2002 corporate scandals. This debate is useful since it could lead to new insights into how to improve corporate governance. Nevertheless, it is impor- tant to recognize that corporate governance is not as flawed as some critics con- tend. While improvements in governance are conceptually possible, it is critical to consider both the costs and benefits when evaluating governance changes at either the firm or regulatory level.

Reference no: EM13920858

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