Departmental accounting helps an organisation to evaluate each departmental growth separately on the basis of trading results over period of time. An endeavour may be made to push up the sales of the department which is earning maximum profit. Department accounting or departmental accounting is a system of financial accounting which is used in the organisations whose all works are done through their different departments or departmental stores. Departmental accounts are prepared separately for each department and trial balance will also be prepared. The topic refers to maintaining accounts for one or more departments of the company. Revenues and expenses of the department are recorded and reported separately. The departments are then consolidated into the accounts of the head office to prepare the financial statements of the company.

Abhijith S

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