Lets quickly compare the three entities
- Profit center is an organizational unit in accounting that reflects a management-oriented structure of the organization for the purpose of internal control.
- Profit Center Accounting evaluates the profit or loss of individual, independent areas within an organization.
- These areas are responsible for their costs and revenues.
- Cost Centers are the organizational units within a controlling area that represents a location where costs occur.
- Organizational divisions can be done on the basis of functional, settlement-related, activity-related, region/section/department related, and/or responsibility-related, to monitor actual and plan figure standpoints
- Where cost is captured.
- An internal order is used to accumulate cost for a specific project or task for a specific time period.
- An internal order is therefore used for a short period with a specific deadline.