Little Ltd has a branch in Bath at which a full set of books is kept. At the end of the year the following summary is compiled of the transactions between the branch and headquarters as recorded in the latter’s books:

At 30 September the branch profit and loss account showed a net profit of £42,000 for the six months.

(a) Show the above items as they would appear in the ledger of the head office.

(b) How can any resulting balance from these figures be proved, and what does it indicate?

Transcribed Image Text:

Balance due from branch 1 April 60,480 Cash received from branch 90,000 Goods supplied to branch 69,480 Goods returned by branch 1,200 Expenses paid on behalf of branch 11,000