Branch Account from the following particulars:
Stock on 1st April 2007
Debtors an 1st April 2007
Goods Sapplied to Branch
Expenses paid by the Head office:
Rent-1st April, 2003 to 30th June, 2008
Insurance upto 30th June, 2008
Salary and Wages
Goods returned by Branch
Cash remitted of Head Office
Stock 31st March, 2008
Stock in transit from Head Office on 31st March, 2008
Debtors, 31st March, 2008
Cash Sales
Credit Sales
Discount allowed to Customers
Bad debts
Answers
Answer:
Problem 1.
Concept & Co., with its Head Office at Mumbai has a branch at Nagpur. Goods are invoiced to the Branch at
cost plus
%
3
1
33 . The following information is given in respect of the branch for the year ended 31st March,
2006:
Particulars `
Goods sent to Branch (Invoice price)
Stock at Branch on 1.4.2005 (Invoice price)
Cash sales
Return of goods by customers to the Branch
Branch expenses (paid in cash)
Branch debtors balance on 1.4.2005
Discount allowed
Bad debts
Collection from Debtors
Branch debtors cheques returned dishonoured
Stock at Branch on 31.3.2006 (Invoice price)
Branch debtors balance on 31.3.2006
4,80,000
24,000
1,80,000
6,000
53,500
30,000
1,000
1,500
2,70,000
5,000
48,000
36,500
Prepare, under the Stock and Debtors system, the following Ledger Accounts in the books of the Head Office:
(i) Nagpur Branch Stock Account
(ii) Nagpur Branch Debtors Account
(iii) Nagpur Branch Adjustment Account
Also compute shortage of Stock at Branch, if any. [May – 2006]
Solution
Dr. Branch Stock Account [Invoice price]
Particulars ` Particulars `
To Balance b/d
To Goods Sent to Branch A/c
To Branch Debtors (Return)
24,000
4,80,000
6,000
By Bank A/c (Cash Sales)
By Branch Debtors (Credit Sales)
By Abnormal Loss:
By Adjustment 500
By P/L A/c 1,500
By Balance c/d
1,80,000
2,80,000
2,000
48,000
5,10,000 5,10,000
Dr. Nagpur Branch Debtors Account
Particulars ` Particulars `
To Balance b/d
To Branch cash (Dishonour of
cheques)
To Branch Stock A/c Credit sales
(b.f.)
30,000
5,000
2,80,000
By Branch cash
By Branch Stock A/c (return)
By Branch Bad Debts
By Branch Discount allowed
By Balance c/d
2,70,000
6,000
1,500
1,000
36,500
3,15,000