Renu Ltd. Trichy has a branch at Madurai. Goods are invoiced to the branch at selling price being cost plus 25%. The branch keeps its own sales ledger and deposits all cash received daily to the credit of the H.O. account at Madurai. All expenses are paid by cheque from Trichy.
From the following information, prepare the branch account in the H.O. books. Carry out necessary adjustments to ascertain the profit made by the branch during the year:
|
Rs |
Rs |
||
|
Opening Stock at Branch |
37,500 |
Cash Sales for the Year |
1,62,000 |
|
Closing Stock at Branch at Cost |
45,000 |
Sundry Expenses |
2,500 |
|
Sundry Debtors (opening) |
21,000 |
Credit Sales |
1,05,000 |
|
Sundry Debtors at the End |
27,000 |
Goods returned to H.O. |
2,000 |
|
Goods Invoiced from H.O. |
2,75,000 |
Wages Paid |
10,200 |
|
Rent, Rates and Taxes |
12,000 |
Wages still Outstanding at the End |
1,000 |
|
Pre-paid Sundry Expenses at the End |
100 |