# Cost and profit centres

Source: https://projectalevel.co.uk/business_studies/finance/cost_and_profit_centres

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- Cost and profit centres are used to look at the costs and profits caused by different departments or sections of a business. Each department or section is known as a centre.
- Cost and profit centres may be used to divide up the fixed costs of a company into different departments.

#### **Advantages of using cost and profit centres:**

- Helps achieve financial control.
- Helps organise the business and give it structure.
- Helps motivate staff in each centre.