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What is the difference between business area and profit center?
SAP Modules questions and answers
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What is the difference between business area and profit center?
Answer1:
Business area is where the total business is valuated as a whole
Whereas Profit centre is an area where the company/work place allows the outside agency to use its machinery for external profits (eq: A CNC machiine which can run 24 hrs a day is utilised in our company for 15 hrs and the balance 9 hrs is let out for addition to the company's profit) is known as Profit Centre.
Answer2:
Business area is related term to FI module and Profit centre is related to CO module. One business area can have one or more profit centres.
Answer3:
Business area is gared on external accounting where as profit centers are used for internal accounting purposes
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