Difference between Cost center and profit center

[Former Member]

I need to know what the difference is between a cost center and a profit center eg. A work center has both a cost center and a profit center. What do they collect for that particular work center.

Thanks

[former_member187991]

hi tefo

differenc is whatever the cost involved will be collected both to the cost center and profit center, when we settle the order it will be settled in the cost element for cost center. the cost will be reflected in profit center which is assinged to the particular cost center.in profit center you can cpature revenue also which is used to map the profit loss for the concern, where as cost center will only capture the expenses

regards

thyagarajan

[Former Member]

hi,

The difference between a Cost Center and a Profit Center is that the Cost Center represents individual costs incurred during a given period and Profit Centers contain the balances of costs and revenues.

Aravind

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[Former Member]

Cost centers aggregate under a profit center (usually). Cost centers collect costs. In case your order can make a profit like a service order or a refurbishment order then the profit center can collect the net difference.

Cost/profit centers can go towards advanced concepts such as COPA and profitability segments.