Chapter 24, Problem 3QS

To determine

Introduction:

Responsibility Accounting System:

Responsibility Accounting System is an accounting system which reports responsibility for managers and helps in evaluation of the performance of managers.

Direct Expenses:

Direct expenses are expenses which are directly traceable to the production units or department.

Indirect Expenses:

Indirect expenses are expenses which are not directly traceable to the production units and these expenses are incurred for more than one unit or departments.

Controllable Costs:

Controllable Costs are the costs which can be controlled by manager's decisions.

Uncontrollable Costs:

Uncontrollable Costs are the costs which cannot be controlled by manager's decisions.

The Costs to be included in the responsibility accounting report of the service department