What is a cost center

Last updated: 2023-01-25
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A cost center is a real or virtual organizational unit of a company to which costs are assigned in terms of responsibility. Cost centers are the basis of company controlling and cost accounting. It is one of the so-called cost objects, for example next to orders and projects.

  • costs are assigned to the cost center
  • employees (and their costs) are assigned to the cost center
  • property, equipment (and their costs) are assigned to a cost center