Adv Accounts 07 Departmental Accounts

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**Unrealized Profit** One department transfers goods to another department at a profit. If such goods are not sold at the end of the year, then there is 'Unrealized Profit'. This 'Unrealized Profit' is computed based on transferee's stock. This 'unrealised profit' is eliminated from 'General Profit and Loss Account'. °°° but if the remuneration of the manager of transferor department is based on the realised profit, and if any profit is still unrealised, then 'Unrealised Profit' (computed based on transferee's stock) should be eliminated from from transferor department and not from transferee department or general P&L °°°

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