Shimla H.O. supplies goods to its branch at Chennai at invoice price which is cost plus 50%. All cash received by the branch is remitted to Shimla and all branch expenses are paid by H.O. From the following particulars related to Chennai branch for the year 2009, prepare (i) Branch Account, (ii) Branch Stock Account, (iii) Branch Debtors Account, (iv) Branch Adjustment Account and (v) Branch Expenses Account to ascertain Gross Profit and Net Profit made by the Branch:
|
Rs |
Rs |
||
|
Stock with Branch on Jan 1, 2009 |
30,000 |
Allowance to Customers off Selling Price(already adjusted on invoicing) |
1,000 |
|
Branch Debtors on Jan 1, 2009 |
6,000 |
||
|
Petty Cash Balance on Jan 1, 2009 |
50 |
||
|
Goods received from H.O. (at Invoice Price) |
93,000 |
Expenses (Cash paid by H.O.) Rent |
1,200 |
|
Goods returned to N.O. |
1,500 |
Salaries |
12,000 |
|
Credit Sales Less Returns |
42,000 |
Petty Cash |
500 |
|
Cash received from Debtors |
45,000 |
Stock with Branch on Dec31, 2009 at Invoice Price |
27,000 |
|
Discount allowed to Debtors |
1,200 |
||
|
Cash Sales |
52,000 |
||
|
Petty Cash balance on Dec 31, 2009 |
5O |
Note: Allowance to customers may be treated as sales promotional expense.