CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

LESSON 4-3LESSON 4-3

Preparing a Work Sheet for a Departmentalized Business

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Chapter 4 ObjectivesChapter 4 ObjectivesFinancial Reporting for a Financial Reporting for a Departmentalized BusinessDepartmentalized Business

After studying Chapter 4, you will be able to:Define accounting terms related to cost accounting and financial reporting for a departmentalized merchandising business.Identify accounting concepts and practices related to cost accounting and financial reporting for a departmentalized merchandising business.Distinguish between direct and indirect expenses.Prepare an interim departmental statement of gross profit.Prepare a work sheet for a departmentalized merchandising business.Prepare financial statements for a departmentalized merchandising business.Analyze financial statements using selected component percentages.Complete end-of-period work for a departmentalized merchandising business.

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LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Lesson 4-3Lesson 4-3

schedule of accounts receivable: a list of customer accounts, account balances, and total amount due from all customers

schedule of accounts payable: a list of vendor accounts, account balances, and total amount due all vendors

work sheet: a columnar accounting form used to summarize the general ledger information needed to prepare financial statements

trial balance: a proof of the equality of debits and credits in a general ledger

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LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Lesson 4-3Lesson 4-3

plant assets: assets that will be used for a number of years in the operation of a business

depreciation expense: the portion of a plant asset’s cost that is transferred to an expense account in each fiscal period during a plant asset’s useful life

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LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

PROVING THE ACCURACY OF PROVING THE ACCURACY OF POSTING TO SUBSIDIARY LEDGERSPOSTING TO SUBSIDIARY LEDGERS page 99

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

pages 102-103DEPARTMENTAL WORK SHEETDEPARTMENTAL WORK SHEET

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

DEPARTMENTAL WORK SHEETDEPARTMENTAL WORK SHEET pages 102-103

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

ADJUSTMENT INFORMATIONADJUSTMENT INFORMATION page 104

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

ADJUSTMENTS SHOWN ON ADJUSTMENTS SHOWN ON WORK SHEETWORK SHEET

PercentageTotal Saleson Account

Estimated Uncollectible Accounts Expense

× =

$210,940.00 × = $2,109.401%

page 104

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

2. Write department loss in Income Statement Debit column.

1. Write department loss in Departmental Margin Statement Credit column.

DEPARTMENTAL AND COMPANY DEPARTMENTAL AND COMPANY LOSS ON A WORK SHEETLOSS ON A WORK SHEET

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page 109

11 22 33 44

3. Record company loss in Income Statement Credit column.

4. Record company loss in Balance Sheet Debit column.

5. Add description.

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Careers in Accounting – page 101Careers in Accounting – page 101

Dianne Villanueva Conry, Part-Time Senior Accountant and Accounting Instructor

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LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

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LESSON 4-3

DEFINE TERMS REVIEWDEFINE TERMS REVIEWIn QuizletIn Quizlet

schedule of accounts receivable schedule of accounts payable work sheet trial balance plant assets depreciation expense

page 110

Edit this set: Chapter 4 AdvAcc (then SAVE)

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Exit Ticket for today:Exit Ticket for today:Audit Your Understanding 4-3Audit Your Understanding 4-3

1. What two reports are prepared to prove the accuracy of posting to subsidiary ledgers?

2. Why are adjustments made to certain accounts at the end of the fiscal period?

3. What account balances are extended to the Balance Sheet columns of a work sheet?

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LESSON 4-3

In a Word Document, SaveAS: Chapter4-3AYUYourNameAnd drop in my Inbox today!

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

Complete the following assignments for Complete the following assignments for Chapter 4-3 todayChapter 4-3 today

Define Terms Review on page 110. Answer Audit Your Understanding questions on page

110. Complete Work Together 4-3 on Aplia – page 110. Complete On Your Own 4-3 on Aplia – page 110. Complete Application Problem 4-3 on Aplia – page

127.

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LESSON 4-3