A Calcutta merchant has a branch at Delhi to which he charges out the goods at cost plus 25%. The Delhi branch keeps his own sales ledger and transmits all cash received to the head office every day. All expenses are paid from the head office. The transactions for the Branch were as follows: (all figures in ~)
|
Stock on 1.1.2014 |
22,000 |
Allowances to customers |
500 |
|
Debtors on 1.1.2014 |
200 |
Returns inward |
1,000 |
|
Petty cash on 1.1.2014 |
200 |
Cheques sent to branch: |
|
|
Cash sales |
5,300 |
Rent : ~ 1,200; Wages : ~ 400; Salaries : ~ 1,800 |
|
|
Goods sent to branch |
40,000 |
Stock on 31.12.2014 |
26,000 |
|
Collections on ledger accounts |
42,000 |
Debtors on 31.12.2014 |
4,000 |
|
Goods returned to head office |
600 |
Petty cash on 31.12.2014 (including miscellanous income |
250 |
|
Bad debts |
600 |
not remitted ~ 50) |
|
Prepare the Branch Account and the Branch Trading and Profit and Loss Account for the year ending 31.12.2014 in the head office books.
