AA1 - Chapter 9 (2016 edition) page 200

Problem 9 – 10
Triple N Commercial
Working Paper for Combined Financial Statements for Home Office and Branch
For the Year Ended December 31, 2016

Adjusted Branch Home Office Combined

Trial Balance Adjustments Trial Balance Eliminations Income Statement Income Statement Balance Sheet
Debits HO Branch HO Branch HO Branch Debit Credit Debit Credit Debit Credit Debit Credit
Cash 50,100 1,260 a. 5,320 b. 2,100 55,420 3,360 58,780
Accounts Receivable (net) 350,000 135,660 c. ( 2,500) 350,000 133,160 483,160
Inventory – Home office 64,400 64,400 64,400 70,000
Branch 32,340 32,340 a. 2,940 29,400 32,200 102,200
Fixed Assets (net) 210,000 210,000 210,000
Branch Current 163,120 a. (5,320) 157,800 c. 157,800
Purchases 532,000 532,000 532,000
Shipments from Home Office 294,000 d. 14,000 308,000 b. 28,000 280,000
Sundry Expenses 119,980 83,440 119,980 83,440 83,440 119,980
Income Tax f. 20,286 e. 9,408 20,286 9,408 9,408 20,286
1,489,600 546,700 20,286 23,008 1,509,886 569,708
Credits
Accounts Payable 30,500 10,500 30,500 10,500 41,000
Mortgage Payable 67,500 67,500 67,500
Income Tax Payable f. 20,286 e. 9,408 20,286 9,408 29,694
Home Office Current 144,200 b. 2,100
c. ( 2,500)
d. 14,000 157,800 c. 157,800
Sales 434,000 392,000 434,000 392,000 392,000 434,000
Shipments to Branch 308,000 308,000 b. 28,000 280,000
Allowance for Overvaluation 2,940 2,940 a. 2,940
Ordinary Share Capital 600,000 600,000 600,000
Retained Earnings 46,660 46,660 46,660
1,489,600 546,700 20,286 23,008 1,509,886 569,708 188,740 188,740 402,248 424,200 736,666 784,000 854,140 784,854
Branch net income 21,952 21,952
Home Office net income 47,334 47,334
424,200 424,200 784,000 784,000 854,140 854,140

Inventory, end:
Home Office P 70,000
Branch [(P21,420 + P14,000) / 110%] 32,200
Total P102,200
AA1 - Chapter 9 (2016 edition) page 200