{"id":3828,"date":"2021-03-03T14:29:31","date_gmt":"2021-03-03T13:29:31","guid":{"rendered":"https:\/\/www.financetuts.com\/?p=3828"},"modified":"2021-06-15T12:04:50","modified_gmt":"2021-06-15T10:04:50","slug":"investment-center","status":"publish","type":"post","link":"https:\/\/www.financetuts.com\/investment-center\/","title":{"rendered":"Investment Center: The Complete Guide [+ Examples]"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"3828\" class=\"elementor elementor-3828\">\n\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-38a13b70 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"38a13b70\" data-element_type=\"section\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-6c45d77d\" data-id=\"6c45d77d\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-2b4678e4 elementor-widget elementor-widget-theme-post-title\" data-id=\"2b4678e4\" data-element_type=\"widget\" data-widget_type=\"theme-post-title.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-67977482 elementor-widget elementor-widget-heading\" data-id=\"67977482\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<p class=\"elementor-heading-title elementor-size-default\">Everything you need to know about investment centers [explained by a Certified Accountant]<\/p>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-e2ac0db elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"e2ac0db\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-33 elementor-top-column elementor-element elementor-element-3326dc6d\" data-id=\"3326dc6d\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap\">\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t<div class=\"elementor-column elementor-col-66 elementor-top-column elementor-element elementor-element-768e6def\" data-id=\"768e6def\" data-element_type=\"column\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-76484589 elementor-widget elementor-widget-heading\" data-id=\"76484589\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">What Is an Investment Center?<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-c1fb452 elementor-widget elementor-widget-uael-infobox\" data-id=\"c1fb452\" data-element_type=\"widget\" data-widget_type=\"uael-infobox.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\n<div class=\"uael-module-content uael-infobox uael-imgicon-style-normal  uael-infobox-left  infobox-has-icon uael-infobox-icon-left  uael-infobox-image-valign-top  uael-infobox-stacked-tablet  uael-infobox-link-type-none\">\n\t<div class=\"uael-infobox-left-right-wrap\">\n\t\t\t\t\t\t\t\t<div class=\"uael-module-content uael-imgicon-wrap \">\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"uael-icon-wrap elementor-animation-bounce-in\">\n\t\t\t\t\t\t\t\t<span class=\"uael-icon\">\n\t\t\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"far fa-lightbulb\"><\/i>\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"uael-infobox-content\">\n\t\t\t\t\t\t<div class='uael-infobox-title-wrap'><\/div>\t\t\t\t\t\t\t\t\t<div class=\"uael-infobox-text-wrap\">\n\t\t\t\t<div class=\"uael-infobox-text elementor-inline-editing\" data-elementor-setting-key=\"infobox_description\" data-elementor-inline-editing-toolbar=\"advanced\">\n\t\t\t\t\tInvestment center is an autonomous unit within an organization that is responsible for generating its own revenue as well as controlling the costs and assets used by the segment, whose performance is measured based on how it utilizes the capital employed to contribute to the entity\u2019s profitability.\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"uael-separator-parent\">\n\t\t\t\t<div class=\"uael-separator\"><\/div>\n\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-73d74f5 elementor-widget elementor-widget-text-editor\" data-id=\"73d74f5\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>Investment centers have 3 main characteristics:<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-98d1137 elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"98d1137\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-puzzle-piece\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">1. Independence<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-696507a elementor-widget elementor-widget-text-editor\" data-id=\"696507a\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>Investment center is a <strong>standalone<\/strong> business segment accountable for its own <strong>assets<\/strong>, <strong>expenses<\/strong> and <strong>revenues<\/strong>.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-3500f9a elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"3500f9a\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-chart-line\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">2. Profit<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-d4f8c5f elementor-widget elementor-widget-text-editor\" data-id=\"d4f8c5f\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The objective of an investment center is to use capital employed to contribute to the <strong>profitability<\/strong> of its parent company.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-fff59ab elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"fff59ab\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-recycle\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">3. Return on Investment<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-1daa054 elementor-widget elementor-widget-text-editor\" data-id=\"1daa054\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The performance of an investment center is evaluated on the basis of the <strong>return earned<\/strong> on invested capital.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-53f514b elementor-widget-divider--view-line elementor-widget elementor-widget-divider\" data-id=\"53f514b\" data-element_type=\"widget\" data-widget_type=\"divider.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-divider\">\n\t\t\t<span class=\"elementor-divider-separator\">\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2671615c elementor-widget elementor-widget-heading\" data-id=\"2671615c\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Examples of Investment Centers<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-33f9211 elementor-widget elementor-widget-uael-infobox\" data-id=\"33f9211\" data-element_type=\"widget\" data-widget_type=\"uael-infobox.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\n<div class=\"uael-module-content uael-infobox uael-imgicon-style-normal  uael-infobox-left  infobox-has-icon uael-infobox-icon-left  uael-infobox-image-valign-top  uael-infobox-stacked-tablet  uael-infobox-link-type-none\">\n\t<div class=\"uael-infobox-left-right-wrap\">\n\t\t\t\t\t\t\t\t<div class=\"uael-module-content uael-imgicon-wrap \">\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"uael-icon-wrap elementor-animation-bounce-in\">\n\t\t\t\t\t\t\t\t<span class=\"uael-icon\">\n\t\t\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"far fa-lightbulb\"><\/i>\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"uael-infobox-content\">\n\t\t\t\t\t\t<div class='uael-infobox-title-wrap'><\/div>\t\t\t\t\t\t\t\t\t<div class=\"uael-infobox-text-wrap\">\n\t\t\t\t<div class=\"uael-infobox-text elementor-inline-editing\" data-elementor-setting-key=\"infobox_description\" data-elementor-inline-editing-toolbar=\"advanced\">\n\t\t\t\t\tThe most common examples of investment centres are company subsidiaries and divisions separated from one another by function, location, product group or service type.\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"uael-separator-parent\">\n\t\t\t\t<div class=\"uael-separator\"><\/div>\n\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-5c53bf4 elementor-widget elementor-widget-text-editor\" data-id=\"5c53bf4\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>Although an investment center can be <strong>any<\/strong> business segment that is in charge of its own revenues, expenses and assets, the categorization is particularly useful when an entity makes a relatively large investment in terms of working capital or fixed assets into an organizational unit.<\/p><p>The concept of investment centers can be applied to independent segments of both large corporations and smaller companies.<\/p><p>To the outside eye, the individual investment centers may seem like separate companies, even though they in fact belong to the same entity.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-451d064c elementor-widget elementor-widget-heading\" data-id=\"451d064c\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h3 class=\"elementor-heading-title elementor-size-default\">Real-life Example: Colgate-Palmolive <\/h3>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-588660bb elementor-widget elementor-widget-text-editor\" data-id=\"588660bb\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>As a real-life example, the <a href=\"https:\/\/investor.colgatepalmolive.com\/sec-filings\" target=\"_blank\" rel=\"nofollow noopener\">annual report of Colgate-Palmolive Company<\/a> states that the multinational corporation manufactures and markets a wide variety of products in 2 main product segments and 5 geographical segments:<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-464df478 elementor-widget elementor-widget-heading\" data-id=\"464df478\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h4 class=\"elementor-heading-title elementor-size-default\">Colgate-Palmolive 2 Product Segments<\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-7706abb2 elementor-widget elementor-widget-heading\" data-id=\"7706abb2\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h5 class=\"elementor-heading-title elementor-size-default\">1. Oral, Personal and Home Care<\/h5>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2b16f6c elementor-align-left elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"2b16f6c\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-tooth\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">Oral Care<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-1bd6079b elementor-widget elementor-widget-text-editor\" data-id=\"1bd6079b\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<ul><li>Toothpaste, toothbrush and mouthwash brands: Colgate, Darlie, elmex, meridol<\/li><\/ul>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-ce7d1ad elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"ce7d1ad\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-bath\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">Personal Care<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-725c89e2 elementor-widget elementor-widget-text-editor\" data-id=\"725c89e2\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<ul><li>Shower gel, liquid and bar soap brands: Protex, Sanex, Softsoap, Irish Spring, Palmolive<\/li><li>Deodorant and antiperspirant brands: Lady Speed Stick, Sanex, Speed Stick, Tom\u2019s of Maine<\/li><li>Skin health brands: EltaMD, Filorga, PCA Skin<\/li><li>Shampoo and conditioner brands: Palmolive<\/li><\/ul>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-f91a1c7 elementor-icon-list--layout-traditional elementor-list-item-link-full_width elementor-widget elementor-widget-icon-list\" data-id=\"f91a1c7\" data-element_type=\"widget\" data-widget_type=\"icon-list.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<ul class=\"elementor-icon-list-items\">\n\t\t\t\t\t\t\t<li class=\"elementor-icon-list-item\">\n\t\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-icon\">\n\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"fas fa-house-user\"><\/i>\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t<span class=\"elementor-icon-list-text\">Home Care<\/span>\n\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t<\/ul>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-11a1f95d elementor-widget elementor-widget-text-editor\" data-id=\"11a1f95d\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<ul><li>Dishwashing liquid brands: Ajax, Axion, Palmolive<\/li><li>Household cleaner brands: Ajax, Fabuloso, Murphy<\/li><li>Fabric conditioner brands: Suavitel (Latin America), Soupline (Europe), Cuddly (South Pacific)<\/li><\/ul>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-3d30eb65 elementor-widget elementor-widget-heading\" data-id=\"3d30eb65\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h5 class=\"elementor-heading-title elementor-size-default\">2.\tPet Nutrition<\/h5>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-6f6e174e elementor-widget elementor-widget-text-editor\" data-id=\"6f6e174e\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<ul><li>Everyday nutritional needs: Hill\u2019s Science Diet (Hill\u2019s Science Plan in Europe)<\/li><li>Therapeutic nutrition to manage disease conditions: Hill\u2019s Prescription Diet<\/li><\/ul>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-7177ece6 elementor-widget elementor-widget-heading\" data-id=\"7177ece6\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h5 class=\"elementor-heading-title elementor-size-default\">3. Corporate<\/h5>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-40274f82 elementor-widget elementor-widget-text-editor\" data-id=\"40274f82\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>In addition, the company has a Corporate segment, which primarily consists of financial investments, such as equity securities or derivative instruments.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-33c320b2 elementor-widget elementor-widget-heading\" data-id=\"33c320b2\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h4 class=\"elementor-heading-title elementor-size-default\">Colgate-Palmolive 5 Geographical Segments <\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-5821b25 elementor-widget elementor-widget-text-editor\" data-id=\"5821b25\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>While the company is present in over 80 countries and territories around the world, the operations of the product segments are managed geographically in 5 reportable operating segments:<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-9894463 elementor-widget elementor-widget-text-editor\" data-id=\"9894463\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<ol><li>North America<\/li><li>Latin America<\/li><li>Europe<\/li><li>Asia Pacific<\/li><li>Africa\/Eurasia<\/li><\/ol>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2ab322b elementor-widget-divider--view-line elementor-widget elementor-widget-divider\" data-id=\"2ab322b\" data-element_type=\"widget\" data-widget_type=\"divider.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-divider\">\n\t\t\t<span class=\"elementor-divider-separator\">\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-29574d73 elementor-widget elementor-widget-text-editor\" data-id=\"29574d73\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>If these business segments of the Colgate-Palmolive Company operate as autonomous units with their management being responsible for the revenues generated, costs incurred and assets employed, then they could be labeled as investment centers.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-5f7aea0 elementor-widget-divider--view-line elementor-widget elementor-widget-divider\" data-id=\"5f7aea0\" data-element_type=\"widget\" data-widget_type=\"divider.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-divider\">\n\t\t\t<span class=\"elementor-divider-separator\">\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-af96237 elementor-widget elementor-widget-heading\" data-id=\"af96237\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h3 class=\"elementor-heading-title elementor-size-default\">How to Evaluate Investment Centre Performance?<\/h3>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-b99805a elementor-widget elementor-widget-text-editor\" data-id=\"b99805a\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The financial performance of an investment center is judged based on the <strong>return on<\/strong>\u00a0<strong>assets<\/strong> invested in that specific business unit to measure how well it utilizes its capital to contribute to the overall bottom line of a business.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-24dfac3 elementor-widget elementor-widget-text-editor\" data-id=\"24dfac3\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>This is because an investment center is typically used when a business makes a significant investment in the assets of a subunit that has been delegated the responsibility for its own <strong>revenue<\/strong>, <strong>expenses<\/strong>, and the <strong>assets<\/strong> invested in the center.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-4e57750 elementor-widget elementor-widget-text-editor\" data-id=\"4e57750\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>The financial indicators commonly used to calculate how well an investment center is performing in terms of the return earned on the invested capital include:<\/p><ul><li>Return on investment (<strong>ROI<\/strong>) &#8211; earnings divided by investment<\/li><li>Residual income (<strong>RI<\/strong>) &#8211; earnings minus expected target return<\/li><li>Economic value added (<strong>EVA<\/strong>) &#8211; after-tax earnings minus cost of capital<\/li><li>Return on capital employed (<strong>ROCE<\/strong>) &#8211; earnings divided by capital employed<\/li><\/ul>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-4ae7328 elementor-widget elementor-widget-text-editor\" data-id=\"4ae7328\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>For <strong>internal<\/strong> accounting purposes, investment center is typically treated as a <strong>separate<\/strong> reporting entity with its own financial statements, which are then <strong>consolidated<\/strong> into the parent entity\u2019s <strong>external<\/strong> reports.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-5c312db elementor-widget-divider--view-line elementor-widget elementor-widget-divider\" data-id=\"5c312db\" data-element_type=\"widget\" data-widget_type=\"divider.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-divider\">\n\t\t\t<span class=\"elementor-divider-separator\">\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-635a1e7c elementor-widget elementor-widget-heading\" data-id=\"635a1e7c\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Investment Center vs. Profit Center<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-79941c4 elementor-widget elementor-widget-uael-infobox\" data-id=\"79941c4\" data-element_type=\"widget\" data-widget_type=\"uael-infobox.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\n<div class=\"uael-module-content uael-infobox uael-imgicon-style-normal  uael-infobox-left  infobox-has-icon uael-infobox-icon-left  uael-infobox-image-valign-top  uael-infobox-stacked-tablet  uael-infobox-link-type-none\">\n\t<div class=\"uael-infobox-left-right-wrap\">\n\t\t\t\t\t\t\t\t<div class=\"uael-module-content uael-imgicon-wrap \">\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"uael-icon-wrap elementor-animation-bounce-in\">\n\t\t\t\t\t\t\t\t<span class=\"uael-icon\">\n\t\t\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"far fa-lightbulb\"><\/i>\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"uael-infobox-content\">\n\t\t\t\t\t\t<div class='uael-infobox-title-wrap'><\/div>\t\t\t\t\t\t\t\t\t<div class=\"uael-infobox-text-wrap\">\n\t\t\t\t<div class=\"uael-infobox-text elementor-inline-editing\" data-elementor-setting-key=\"infobox_description\" data-elementor-inline-editing-toolbar=\"advanced\">\n\t\t\t\t\tThe difference between a profit center and an investment center is that a profit center is a responsibility center whose performance is measured only based on the profits it generates, whereas investment center is evaluated based on its use of capital and return on investment.\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"uael-separator-parent\">\n\t\t\t\t<div class=\"uael-separator\"><\/div>\n\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-f814f50 elementor-widget elementor-widget-text-editor\" data-id=\"f814f50\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>In other words, an investment center is an extended <a href=\"https:\/\/emilien6.sg-host.com\/profit-center\/\" target=\"_blank\" rel=\"noopener nofollow\">profit center<\/a> in which not only revenues and expenses are measured, but also the return earned on assets and invested capital.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-259aa751 elementor-widget elementor-widget-heading\" data-id=\"259aa751\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">Investment Center vs. Cost Center<\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-86d4560 elementor-widget elementor-widget-uael-infobox\" data-id=\"86d4560\" data-element_type=\"widget\" data-widget_type=\"uael-infobox.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\n<div class=\"uael-module-content uael-infobox uael-imgicon-style-normal  uael-infobox-left  infobox-has-icon uael-infobox-icon-left  uael-infobox-image-valign-top  uael-infobox-stacked-tablet  uael-infobox-link-type-none\">\n\t<div class=\"uael-infobox-left-right-wrap\">\n\t\t\t\t\t\t\t\t<div class=\"uael-module-content uael-imgicon-wrap \">\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"uael-icon-wrap elementor-animation-bounce-in\">\n\t\t\t\t\t\t\t\t<span class=\"uael-icon\">\n\t\t\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"far fa-lightbulb\"><\/i>\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"uael-infobox-content\">\n\t\t\t\t\t\t<div class='uael-infobox-title-wrap'><\/div>\t\t\t\t\t\t\t\t\t<div class=\"uael-infobox-text-wrap\">\n\t\t\t\t<div class=\"uael-infobox-text elementor-inline-editing\" data-elementor-setting-key=\"infobox_description\" data-elementor-inline-editing-toolbar=\"advanced\">\n\t\t\t\t\tThe difference between a cost center and an investment center is that the performance of a cost center is measured based on the costs it incurs to run its operations, whereas an investment center is evaluated according to return on investment as it is responsible for its costs, revenues and assets.\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"uael-separator-parent\">\n\t\t\t\t<div class=\"uael-separator\"><\/div>\n\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-78a34a5a elementor-widget elementor-widget-text-editor\" data-id=\"78a34a5a\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>In a cost center, the focus is on minimizing costs, which may not directly contribute to a company\u2019s profitability.<\/p><p>In contrast, the management of an investment center is focused on maximizing the return on assets and capital employed in the business segment.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-6ee305ff elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"6ee305ff\" data-element_type=\"section\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-5d00afba\" data-id=\"5d00afba\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-1068f878 elementor-widget elementor-widget-heading\" data-id=\"1068f878\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<p class=\"elementor-heading-title elementor-size-large\">Sign up for our Newsletter<\/p>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-2f73c06d elementor-widget elementor-widget-text-editor\" data-id=\"2f73c06d\" data-element_type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<p>Get more articles just like this straight into your mailbox.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-5cb0d348 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"5cb0d348\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-50 elementor-top-column elementor-element elementor-element-52b0ee1a\" data-id=\"52b0ee1a\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-515f13c1 elementor-widget elementor-widget-heading\" data-id=\"515f13c1\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<p class=\"elementor-heading-title elementor-size-default\">Related Posts<\/p>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t<div class=\"elementor-column elementor-col-50 elementor-top-column elementor-element elementor-element-29c92be6\" data-id=\"29c92be6\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-4bc8a48b elementor-widget elementor-widget-heading\" data-id=\"4bc8a48b\" data-element_type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<p class=\"elementor-heading-title elementor-size-default\">Recent Posts<\/p>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-684111e7 elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"684111e7\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-4737583f\" data-id=\"4737583f\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t<div class=\"elementor-element elementor-element-36c96033 elementor-widget elementor-widget-spacer\" data-id=\"36c96033\" data-element_type=\"widget\" data-widget_type=\"spacer.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<div class=\"elementor-spacer\">\n\t\t\t<div class=\"elementor-spacer-inner\"><\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Everything you need to know about investment centers [explained by a Certified Accountant] Share on facebook Share on twitter Share on pinterest Share on linkedin Contents What Is an Investment Center? Investment center is an autonomous unit within an organization that is responsible for generating its own revenue as well as controlling the costs and [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":3827,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_wordproof_timestamp":false},"categories":[16],"tags":[],"_links":{"self":[{"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/posts\/3828"}],"collection":[{"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/comments?post=3828"}],"version-history":[{"count":0,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/posts\/3828\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/media\/3827"}],"wp:attachment":[{"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/media?parent=3828"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/categories?post=3828"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.financetuts.com\/wp-json\/wp\/v2\/tags?post=3828"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}