The following information relates to the branch and head office of Fish CC: R 1. Balances...
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The following information relates to the branch and head office of Fish CC: R 1. Balances at 1 January 20.1: Bank (favourable) Inventory (at cost price) 10 000 9 200 2. Transactions of the branch during the year ended 31 December 20.1: R 108 000 38 400 Inventory sent to branch at cost Credit sales Cash sales 88 000 Inventory returned to head office at cost Payments by branch debtors Settlement discount granted to branch debtors Damaged inventory written off at cost 2 400 20 000 600 2 000 Additional information: 1. Inventory supplied to the branch is invoiced at selling price, which is cost plus 20%. 2. An amount of R15 000, included in cash sales, was in respect of sales of inventory purchased from other suppliers and paid for by head office. The profit mark-up on inventory purchased from other supplies is also 20% on cost. 3. A sales person embezzled cash amounting to R750 received from cash sales and the transaction is still to be recorded in the books. 4. To boost the December sales, a special promotion was held at the branch where inventory was sold at selling price less 25%. Proceeds from the special promotion amounted to R22 500 and the amount is included in the cash sales figure. 5. When a physical inventory count was undertaken at the branch, it was discovered that inventory with a cost price of R4 000 was missing. The matter was investigated and it was established that inventory was stolen. 6. The branch donated inventory with a selling price of R1 800 to a local charitable organisation. 7. Inventory on hand at 31 December 20.1, according to the physical inventory count, amounted to R9 600 (at selling price). Required: Prepare the following accounts in the general ledger of Fish CC: a) Branch inventory; b) Inventory to branch; c) Branch adjustment; d) Trade receivables control; e) Bank; f) Settlement discount granted; and g) Branch expense. Balance and close off all the accounts at 31 December 20.1. The following information relates to the branch and head office of Fish CC: R 1. Balances at 1 January 20.1: Bank (favourable) Inventory (at cost price) 10 000 9 200 2. Transactions of the branch during the year ended 31 December 20.1: R 108 000 38 400 Inventory sent to branch at cost Credit sales Cash sales 88 000 Inventory returned to head office at cost Payments by branch debtors Settlement discount granted to branch debtors Damaged inventory written off at cost 2 400 20 000 600 2 000 Additional information: 1. Inventory supplied to the branch is invoiced at selling price, which is cost plus 20%. 2. An amount of R15 000, included in cash sales, was in respect of sales of inventory purchased from other suppliers and paid for by head office. The profit mark-up on inventory purchased from other supplies is also 20% on cost. 3. A sales person embezzled cash amounting to R750 received from cash sales and the transaction is still to be recorded in the books. 4. To boost the December sales, a special promotion was held at the branch where inventory was sold at selling price less 25%. Proceeds from the special promotion amounted to R22 500 and the amount is included in the cash sales figure. 5. When a physical inventory count was undertaken at the branch, it was discovered that inventory with a cost price of R4 000 was missing. The matter was investigated and it was established that inventory was stolen. 6. The branch donated inventory with a selling price of R1 800 to a local charitable organisation. 7. Inventory on hand at 31 December 20.1, according to the physical inventory count, amounted to R9 600 (at selling price). Required: Prepare the following accounts in the general ledger of Fish CC: a) Branch inventory; b) Inventory to branch; c) Branch adjustment; d) Trade receivables control; e) Bank; f) Settlement discount granted; and g) Branch expense. Balance and close off all the accounts at 31 December 20.1.
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Branch Debtors or Trade receivable control Ac Branch Adjustment Ac Particulars Amount Particulars Am... View the full answer
Related Book For
Accounting Principles
ISBN: 978-1119411482
13th edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Posted Date:
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