Question

• M Ltd have a branch of N private Ltd
at kamptee. The head office paid the
following expenses by cheque for branch;
Salary Rs. 6,000 Rent Rs. 1,500 Petty
expenses Rs. 500 Total expenses of branch
paid by head office is
Answer
A. Rs. 6,000
B. Rs. 1,500
C. Rs. 500
D. Rs. 8.000​

Answer 1

Answer:

Branch Maintaining Own Books: Accounting Entries by Head Office!

Generally when branches are small their accounts are maintained by the head office. If the branch is big and, specially, if it carries on manufacturing operations also, it usually maintains its own books of account, extracts own trial balance and prepares its own trading and profit and loss account and balance sheet.

The head office must, however, present one consolidated balance sheet for the benefit of the shareholders and the outside world. The head office will maintain, in its books, “Branch Account” to which goods or cash sent will be debited: When cash is received from the branch, the Branch Account will be credited.