Mr. X of Surat has a branch at Jaipur. Goods are sent at invoice price which is fixed at a profit of 20% on sale under the strict instructions of selling goods only at invoice price. Goods are fully insured against fire and theft. Following are the transactions in respect of Jaipur Branch:
|
Rs |
Rs |
||
|
Opening Balance of Stock |
20,000 |
Loss by Fire (Cost Price) |
15,000 |
|
Opening Balance of Debtors |
6,000 |
Stock at End (Invoice Price) |
7,000 |
|
Closing Balance of Debtors |
7,000 |
Cash received from Debtors |
89,000 |
|
Goods received from H.O. |
2,50,000 |
Goods returned to H.O. |
10,000 |
|
(at Invoice Price) |
Direct Expenses paid by H.O. |
6,500 |
|
|
Indirect Expenses paid by H.O. |
14,000 |
Cash sales: 62.5% of Total Sales
You are required to record the above instructions in the books of the H.O. on the basis of Stock and Debtors System and calculate the net profit of the branch.