Preparation of Departmental Trading, Profit And Loss Account And Balance Sheet - SS3 Accounting Lesson Note
Question:
The following transactions were entered into the trial balance of the media department of Sade Enterprise for the year ending December 2021. You are required to prepare the departmental trading profit and loss account and the departmental balance sheet in tabular form
TRIAL BALANCE OF THE MEDIA DEPARTMENT OF SADE ENTERPRISE FOR THE YEAR ENDED DECEMBER 2021:
|
Account |
Debit (₦)
Credit (₦)
Cash
20,000
-
Accounts Receivable
50,000
-
Equipment
150,000
-
Accumulated Depreciation - Equipment
10,000
-
Supplies
5,000
-
Prepaid Rent
20,000
-
Advertising Revenue
-
180,000
Salaries Expense
40,000
-
Rent Expense
10,000
-
Depreciation Expense
10,000
-
Supplies Expense
3,000
-
Interest Expense
2,000
-
Total
296,000
180,000
Answer:
Media department trading profit and loss account
For the year ended December 2021
|
Particulars |
Amount (₦)
Sales (Advertising Revenue)
Cost of Goods Sold:
- Salaries Expense
- Rent Expense
- Depreciation Expense
- Supplies Expense
Gross Profit
Other Expenses:
- Interest Expense
Net Profit
180,000
40,000
10,000
10,000
3,000
117,000
2,000
115,000
Departmental balance sheet
For the year ended December 2021
|
Particulars |
Amount (₦)
Cash
Accounts Receivable
Equipment
Accumulated Depreciation - Equipment
Supplies
Prepaid Rent
Total Assets
Total Liabilities
Owner's Equity:
- Capital
Total Liabilities and Owner's Equity
20,000
50,000
150,000
(10,000)
5,000
20,000
235,000
-
-
235,000
235,000
Note: The departmental balance sheet shows the assets, liabilities and owner's equity of the media department as of the end of the year. Since this is a departmental account, the liabilities and owner's equity are not separated.