Question

4. Briefly explain the Debtor system of maintaining a Branch A/c.
5. What are the accounting adjustments required in Debtor system when goods are
sent at invoice price to the branch?​

Answer 1

Answer:

4. Under this system the Head Office opens one Branch Account to record various transactions with the Branch. Branch Account is maintained in the form of a Debtor Account. ... The excess of the credit over its debit represents a profit or vice-versa, and is transferred to General Profit and Loss Account of Head Office.

5. In short, Branch Stock Account is debited by crediting opening balance of stock in hand, Goods Sent to Branch, Branch Debtors (for Returns Inward) and the same is credited by debiting Branch Cash Account (for Cash Sales), Branch Debtors Account (for Credit Sales), Goods Sent to Branch Account (for goods returned to ...

Answer 2

Answer:

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Explanation:

1: answer===The following items are to be ignored while preparing Branch Account under this method : The Branch Account is debited with the opening balance of Petty Cash and the amount of petty cash sent by the head office and is credited with the closing petty cash. ...

2:answer===In short, Branch Stock Account is debited by crediting opening balance of stock in hand, Goods Sent to Branch, Branch Debtors (for Returns Inward) and the same is credited by debiting Branch Cash Account (for Cash Sales), Branch Debtors Account (for Credit Sales), Goods Sent to Branch Account (for goods returned to ...Branch Stock Adjustment Account is prepared at Invoice Price. The difference between the two sides of this account reveals either gross profits (if credit side to greater than the debit side) or gross loss (if debit side is greater than the credit side).