Chapter 24, Problem 2DQ

To determine

Concept Introduction:

Operating Department:

These are the departments where the main operations are carried out. These departments are directly involved in the production of output. They generate revenue for the organization.

Service Department:

These departments are not directly involved in production, but their function is very much required for smooth functioning of the operating departments. These department do not generate direct revenue.

Difference between an operating department and a service department: