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Zorluk: OrtaAccounting for Dependent Branches at Cost Price

Match each dependent branch transaction (recorded at cost price) with its corresponding double-entry posting in the Head Office ledger.

  • Goods dispatched to branch by Head OfficeDebit Branch Stock Account; Credit Goods Sent to Branch Account
  • Goods returned by branch to Head OfficeDebit Goods Sent to Branch Account; Credit Branch Stock Account
  • Credit sales made by the branchDebit Branch Debtors Account; Credit Branch Stock Account
  • Cash collected from branch debtors and remitted to Head OfficeDebit Head Office Cash Book; Credit Branch Debtors Account

Cevap

Goods dispatched to branch matches Debit Branch Stock and Credit Goods Sent to Branch; Goods returned by branch matches Debit Goods Sent to Branch and Credit Branch Stock; Credit sales made by branch matches Debit Branch Debtors and Credit Branch Stock; Cash collected from branch debtors matches Debit Head Office Cash Book and Credit Branch Debtors.
Under the cost price method for dependent branch accounting, Head Office maintains all ledger accounts, recording stock additions on the debit side of the Branch Stock Account and stock reductions or remittances on the credit side.

Adım Adım Çözüm

1
Identify the posting for goods dispatched from Head Office to branch
Debit Branch Stock Account and Credit Goods Sent to Branch Account.
Head Office acts as the supplier maintaining control over branch inventory.
2
Identify the posting for goods returned by branch to Head Office
Debit Goods Sent to Branch Account and Credit Branch Stock Account.
Returns reverse the dispatch entry and reduce branch stock.
3
Determine the posting for credit sales made by the branch
Debit Branch Debtors Account and Credit Branch Stock Account.
Credit sales convert branch inventory into branch trade receivables.
4
Determine the entry for cash collections remitted from branch debtors
Debit Head Office Cash Book and Credit Branch Debtors Account.
Receiving cash at Head Office increases Head Office cash balance while reducing branch trade debtors.

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Accounting for Dependent Branches at Cost Price
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Accounting for Dependent Branches at Cost Price

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