What is Departmental Accounting? Give an example

Showing Answers 1 - 3 of 3 Answers


  • Aug 31st, 2008

Departmental accounting is not a norm as far as I know.

It is so because, each department does not need to calculate its profits or losses.

In case where the company needs any department or a set of departments to work in such manner where their profit/loss contribution in company's totals would make a difference, the company form Strategic Business Unit.

The idea of departmental accounting is that each department is getting an input from some other department and they process the input to provide an output and that output will be input for the other some process.

Example: In a car factory- the department which collects all steel and moulds the same into car bodies has its own accounts books. And the department that does the wiring part also has its own accounts books. So on and so forth.

Hope the answer is correct.


  Was this answer useful?  Yes


  • Jun 18th, 2015

Departmental account is an account prepared for different departments in an organization. It is a department with each units or sections, which must account for sales and purchase made monthly quarterly or annually.

  Was this answer useful?  Yes

Give your answer:

If you think the above answer is not correct, Please select a reason and add your answer below.

Answer Question

Click here to Login / Register your free account

Send   Reset


Related Answered Questions


Related Open Questions