Although determining gross profit for departments in a department store has some merit, the idea of trying

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‘Although determining gross profit for departments in a department store has some merit, the idea of trying to determine departmental profit is questionable because of all the indirect costs usually involved. Allocation of these costs is so arbitrary that the allocation process makes the departmental income statement virtually useless.’ Discuss.

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Accounting

ISBN: 978-1118608227

9th edition

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

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