Select the incorrect statement concerning the application of the controllability concept to responsibility accounting.

Select the incorrect statement concerning the application of the controllability concept to responsibility accounting.

Multiple Choice

• As a practical matter, control of costs or revenues may be shared rather than absolute.
• The concept of control is crucial to an effective responsibility accounting system.
• Managers lose motivation when they are held accountable for actions that are beyond their scope of control.
• Each manager should be evaluated on the costs but not the revenues that are under his or her control.