Accounting for IGCSE & O level - Final Statements (Section 6 - No. 1)

Why is it important to identify the contribution to profit or loss of each department in a business?

To determine the salary of each department employee.

To identify and investigate poor performance.

To eliminate the need for a combined income statement.

To know the total expenses of the business.

This helps in understanding where the business is succeeding and where it's facing challenges.