To calculate departmental gross profit, separate accounts should be set up for Assets, Liabilities, etc., for each department.

Name: To calculate departmental gross profit, separate accounts should be set up for Assets, Liabilities, etc., for each department.
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Question

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Departmental gross profit is calculated by subtracting the cost of goods sold from the sales revenue of each department, not by setting up separate accounts for assets, liabilities, etc., for each department.

To Calculate Departmental Gross Profit, Separate Accounts Should Be Set