Department accounts(jkshah)

Q:1
A firm had 2 departments ,A and B. The goods were made by depB out
of good supplied by depA at its selling price. From the following figures
prepare departmental trading and profit &loss accnt for the year 2017-
18.

DEP A DEPB
PARTICULARS Rs. Rs.

Opening stock on 1-4-2017 3,00,000 50,000

Purchases 20,00,0000 -----
Sales 22,00,000 4,50,000
Transfer from depA to DepB 3,00.000 3,00,000
Expenses-manufacturing --- 75000
Selling Expenses 20,000 6000
Stock on 31-3-2018 2,00,000 60,000

The stocks in the depB may be considered as consisting of 75% cloth

and 25% other expenses. The DepA earned gross profit @ 15% in 2016-
17. The general expenses of the business as a whole came to 1,10,000.

Q:2
Dep X sells goods to Dep Y at a profit of 25% on cost & to Dep Z at a
profit of 10% on cost. Dep Y sells goods to X & Z at a profit of 15% and
20% on sales. Dep Z charges 20% and 25% profit on cost to DEP X
and Y.

Depatment managers are entitled to 10% commission on net profit

subject to unrealised profits on departmental sales being eliminated.
Departmental profits after charging managre’s commission , but before
adjustment of unrealised profit are X=36,000 Y=27,000 Z=18,000.

Stocks lying at different departments at the year end are

particulars X Y Z
Transfer from Dep X ---- 15000 11,000

Transfer from Dep Y 14,000 ----- 12000

Transfer from Dep Z 6000 ----

5000
Find out correct departmental profits after charging manager’s
commission.

Q;3

Complex Ltd. Has three departments A, B and C . The foll information is

provided;

PARTICULARS A B C

Opening stock 3000 4000 6000

Consumption of direct materials 8000 12000 ----

Wages 5000 10000 ----

Closing stock 4000 14000 8000

Sales ----- ----- 34000

Stocks of each department are valued at cost to the dep concerened.

Stocks of depA are transferred to depB at a margin of 50% above the
departmental cost. Stocks of depB are transferred to depC at a margin
of 10% above departmental cost.

Other expenses:

Salaries 2000

Printing& stationery 1000

Rent 600

Interest paid 4000

Depreciation 3000

Allocate expenses in the ratio of departmental gross profits. Opening

figures of reserves of unrealised profits on departmental stocks were:

depB=1000

depC=2000

Prepare Departmental Trading and P&L A/C.