Fortune Ltd. with its H.O. in Goa invoiced goods to its branch Bhubaneswar at 20% less than the catalogue price which is cost plus 50% with instructions that cash sales were to be made at invoice price and credit sales at catalogue price less discount at 15% on prompt payment. From the following particulars, prepare Branch Stock Account, Branch Adjustment Account and Branch Profit and Loss Account for the year ended Mar 31, 2009 in the H.O. Books.
|
Rs |
|
|
Stock on Apr 1, 2008 (Invoice Price) |
24,000 |
|
Debtors received Apr 1, 2008 |
20,000 |
|
Goods received from (H.O) at Invoice Price |
2,64,000 |
|
Sales (Cash) |
92,000 |
|
Sales (Credit) |
2,00,000 |
|
Cash received from Debtors |
1,71,270 |
|
Discount allowed to Debtors |
26,730 |
|
Expenses at the Branch |
12,000 |
|
Remittances to H.O. |
2,40,000 |
|
Debtors on Mar 31, 2009 |
22,000 |
|
Cash in Hand on Mar 31, 2009 |
11,270 |
|
Stock on Mar 31, 2009 |
30,000 |
It was further provided that a part of the stock was lost by fire (not covered by insurance) during the year whose value is to be ascertained and a provision should be made for discount to be allowed to debtors as on Mar 31, 2009, on the basis of year’s trend of prompt payment.