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ILLUSTRATION 8.2 A Head Office sends goods to its branch at cost plus 10%. On other sales the Head Office makes a uniform profit of
ILLUSTRATION 8.2 A Head Office sends goods to its branch at cost plus 10%. On other sales the Head Office makes a uniform profit of 33%. The Branch sells goods at a uniform profit of 25%. Following transactions took place during the year ended 31st March, 2015 : (i) Head Office purchases amounted to $7,32,000 and purchase returns were $30,825 and discounts allowed by suppliers amounted to $15,045. (ii) Sales by Head Office amounted to $5,40,000. Goods sent by Head Office to Branch at invoice price amounted to $2,72,250. Discounts allowed to customers were $4,950. (iii) Goods sent to Branch on 31st March, 2015 amounting to $33,000 were in transit. (iv) Goods purchased by the Branch locally were of $91,312. (v) Establishment and other expenses at Head Office were of $1,40,130 and at the Branch of $40,238. (vi) Sales by the Branch amounted to $3,60,000; discount allowed to customers was $2,820 and cost of goods lost in transit was $4,005. (vii) Stock of goods at the Branch as on 31st March, 2015 included goods received from Head Office for $57,750. Prepare a columnar Trading and Profit & Loss Account for Head Office and the Branch for the year ended 31st March, 2015
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