CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 4-3 Preparing a Work Sheet for a Departmentalized Business

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Chapter 4 Objectives Financial Reporting for a Departmentalized 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. 2 LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Lesson 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 3 LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Lesson 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 4 LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 5 LESSON 4-3 PROVING THE ACCURACY OF POSTING TO SUBSIDIARY LEDGERS page 99

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 6 LESSON 4-3 pages DEPARTMENTAL WORK SHEET

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 7 LESSON 4-3 DEPARTMENTAL WORK SHEET pages

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 8 LESSON 4-3 ADJUSTMENT INFORMATION page 104

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 9 LESSON 4-3 ADJUSTMENTS SHOWN ON WORK SHEET Percentage Total Sales on Account Estimated Uncollectible Accounts Expense × = $210,940.00× = $2, % page 104

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 10 LESSON Write department loss in Income Statement Debit column. 1. Write department loss in Departmental Margin Statement Credit column. DEPARTMENTAL AND COMPANY LOSS ON A WORK SHEET 5 page 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 101 Dianne Villanueva Conry, Part-Time Senior Accountant and Accounting Instructor 11 LESSON 4-3

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning 12 LESSON 4-3 DEFINE TERMS REVIEW In 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: Audit Your Understanding 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? 13 LESSON 4-3 In a Word Document, SaveAS: Chapter4-3AYUYourName And drop in my Inbox today!

CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Complete the following assignments for Chapter 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 LESSON 4-3