To understand this topic well, one must already have knowledge of the double entry system, how to draw the financial statements of a sole proprietor and how to make use of simple mathematical ratios. The first slides give a short insight of the topic, when to use departmental accounts and what to do with a department making consistent losses year after another.
The slides to follow will show how departmental accounts are worked out on a layout of a normal financial statements as learned during year 9, but divided into a number of departments. In this case we have an example of two departments and total columns where one will show an aggregation of the figures related to all the departments. As for the trading part, the amounts will normally be given as per department while the amounts for some of the expenditures will be provided as a one numerical figure and they have to be worked out using specific ratios given by the respective question to be separated between different departments. Slide 4 to slide 6 show when to use division by allocation and when to use division by apportionment and how to work out the latter presented by an example using numerical figures.
The last slide then shows a layout of departmental accounts and the entry of the worked out example of water and electricity in the financial statements.