1. Halimbawa property acquired by branch for its own use.

Wala na itong entry sa

home branch.
2. Which entity would you record the actual depreciation of the asset? Kung anong
entity nagcarry ng furniture account or kung ano yung entity ang actual na
nagpossess nung furnitute? Answer: Kung aling entity ang may actual physical
possession regardless kung recorded on its books or not
3. Yung depreciation expense ay credit home office. Di ko talaga magets kasi
expense yun. Ah kasi siguro depreciation expense represent the usage of the asset
so nagbenefit si branch kaya nirecord yun as additional capital for home office
kaya credit. Not sure. Tapos sa HO yung accumulated depreciation.
4. Transfer of shipments from HO to branch: Si HO ang nagbayad ng freight in.
Pero “Cash” lang ang naka-record sa book niya. Tapos kung kanino tinransfer, sa
kanya irerecord yung “freight in” account.
5. Expenses na inako ni home office in behalf ng branch: Baliktaran method lang
6. Remittance entry: Baliktaran lang ang cash and reciprocal accounts

Solving adjusted balances

1. Net adjustment – represents the value of all adjustments added or subtracted (kasi
net)

Special problems
1. HO pays for freight
 So the billed price would not necessarily equate to the value of cost times mark-
up rate because idededuct pa ang value ng freight
 Allowance for markup does not necessarily equate to shipment to branch (higher
amt) minus investment in branch (cost amount). Kasi idededuct pa ang freight
through cash account.
 Shipment from home office would not necessarily equate to marked up amount
kasi idededuct din ang amount of freight.

2. Branch pays for the freight

 As to HO books: There would be no entry for freight. So allowance for mark up =
billed price minus cost
 As to Branch books: Compound entry lang kumbaga so separate entry pa din
kumbaga ang debit freight credit cash so billed price pa din magiging value ng
HO saka

3. Mark-up
 Realized mark up would be total markup minus unrealized markup
 Unrealized markup involves the markup of ending inventory (hindi nabenta).
Hindi na ata kailangan alamin ano halaga ng ending inventory kasi ang formula
lang dito ay MARKED UP PRICE multiply to markup rate divide by 1+markup
rate = ending inventory at billed price
 0701Thu. So ayun na nga, magkaiba ang mark-up rate ng beginning inventory and
shipment to HO.
 If given ang value ng shipment to branch (at cost lagi) saka shipment from HO
(maybe at billed price), swerte ka kasi pagminusin mo lang yun para makuha ang
markup mo at shipment. Dun mo na din malalaman ang markup rate:
Markup/shipment at cost
 Inventory end – kung at billed price siya, idivide mo sa markup rate ng shipment,
hindi sa markup rate ng inventory, beginning.