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OMTEX – CLASSES

“T HE HO ME OF T EX T”
F.Y.B.Com BRANCH A/C F.Y.B.Com

1. Journal entries in the books of Head office


Goods sent to Branch by H.O Goods Return by Branch to H.O
Branch A/c ……… Dr. Goods sent by branch A/c ……Dr
To Goods sent to Branch A/c To Branch A/c
Cash sent by H.O or Branch Cash received from Branch
expenses paid by H.O Cash A/c …… Dr
Branch A/c …… Dr. To Branch A/c
To cash A/c
Recording Branch assets at the Recording Branch assets at the
beginning ending
Branch A/c …… Dr Branch Assets A/c …… Dr
To Branch Assets A/c To branch A/c
Recording Branch liabilities at Recording Branch liabilities at the
the beginning. ending.
Branch liabilities A/c ……Dr. Branch A/c …… Dr.
To Branch A/c To Branch liabilities A/c
Transfer Branch profit Transfer Branch Loss
Branch A/c …… Dr General profit/ loss A/c …… Dr
To General Profit / Loss A/c To Branch A/c
Cash sent by Branch but not Goods sent by Branch but not
received by H.O received by H.O
Cash in transits A/c …… Dr. Goods in transits A/c …… Dr.
To Branch A/c To Branch A/c
The following transactions are not recorded in the Branch A/c However they
may be recorded in the books of Branch to calculate the missing information.
1. Cash or credit sales by Branch
2. Cash or credit purchase by Branch
3. Return of goods by Debtors to branch
4. Return of goods by Branch to suppliers (Cr’s)
5. Receipts of cash from customer (Dr’s)
6. Payment to suppliers (Cr’s) or for expenses by Branch
7. Discount allowed to customer or received from suppliers.
8. Purchase or sale of assets
9. Loss of cash or goods at branch

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OMTEX – CLASSES
“T HE HO ME OF T EX T”
F.Y.B.Com BRANCH A/C F.Y.B.Com

1. Hari is having Head office at Mumbai and Branch office at nashik. Prepare the
branch A/c in the books of Head office .From the following transactions with the
branch.
Particulars Amount
Opening balance at Branch:
Petty cash 1,000
Stock 39,500
Debtors 21,000

Goods supply to branch during the years 3,10,000


Cash remitted by the branch :
Cash sales 1,13,200
Realization from Debtors 2,30,300
Cash remitted to the branch:
Petty cash expenses 4,000
Salaries 12,000
Rent and taxes 3,500
Closing balance at bank
Petty cash 950
Debtors 53,000
stock 26,500

In the books of hair at Mumbai, nashik branch A/c for the year ended

2. Babu Bhai of Mumbai opened Branch at Nasik on 01/01/2002. During the year
ended 31/12/2002 the following transaction have taken place
Goods sent to Nasik 6000
Cash sent to Nasik 5000
Goods return from Nasik 6000
Cash received from Nasik 58000
Rent for Branch Paid by H.O 3,000
Expenses paid by Branch
Salaries 6000
Conveyance 500
Postage 500
Carriage 400
Discount allowed to customer Rs. 800.
Sales on credit amounted to Rs. 8000
Cash sales amounted Rs. 8000
On 31/12/2002 Stock worth Rs. 6000/- was at Branch, Rs. 5000 was due
from Debtors.
Cash on hand was Rs. 1000
Show Branch A/c in the books of Babu Bhai.

3. From the following detail prepare Mumbai Branch A/c for the 6 month ended
31/12/2002 after Depreciation branch furniture @ 20% p.a.

Opening Branch Assets:-


Branch stock 20000
Branch Petty cash 6000
Branch Furniture 26000
Debtors 30000

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OMTEX – CLASSES
“T HE HO ME OF T EX T”
F.Y.B.Com BRANCH A/C F.Y.B.Com

Opening Branch Liabilities


Branch outstanding expenses 1000
Goods sent to branch 1, 80,000
Petty cash sent to branch 16,000
Branch expenses paid by the H.O. 34000
Remittance Received from the Branch 2, 32,800
Closing Branch Asset
Branch stock 24,000
Branch Petty cash 4,000
Branch Debtors 34,000
Closing Branch Liabilities
Branch outstanding salaries 1,400

4. From the following detail of Gupta trader of Partner have their Branch at
Mumbai. Prepare the necessary A/c In the books of H.O from the following
transaction with the Branch.
Opening Balance
Petty cash at Branch 1250
Stock 77,000
Debtors 41250
Goods sent to Branch 3, 78,000

Amount Remitted to Branch


Petty Expenses 7,500
Salaries 18,500
Rent and Taxes 6,000

Closing Balance
Petty cash 1880
Debtors 126150
Stock 57880
Discount allowed to customer 1060

Amount remitted to Branch


Cash sales 26250
Realisation from Debtors 4,10,350

Mr. Sharma to whom goods sold by Branch directly, remitted the amount to
Head office 9000. .

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