A Cost Center is a department or unit within an organization that does not directly generate revenue but incurs costs. Its primary purpose is to manage expenses and support the overall operations of the business. Examples of cost centers include departments like Human Resources, IT, and Customer Service. Organizations track the performance of cost centers to ensure they operate efficiently and within budget. By analyzing costs, management can make informed decisions about resource allocation and identify areas for potential savings. This helps maintain financial health while supporting the company's strategic goals.