Question
Ayomide Limited operates operates a number of retail branches. Goods are invoiced from the Head office in Lagos to branches in Benin, Ibadan, Akure, and Abeokuta at cost plus 331/3% each Branch maintain a Receivable ledger. The following information relates to the Benin branch for the year 31st December, 2018
#
Cash sales. 34,656,000
Credit sales. 36,825,000
Cash remitted to Head office. 70,518,000
Goods sent to branch. 73,860,000
Cash discount to Trade Receivables 932,000
Expenses of Branch ( Paid by Head office ) 4,358,000
Inventory at January 1,2018 2,100,000
Stock at 31st December 2,850,000
Goods returned by branch 600,000
Reduction in selling prices authorized by area manager 108,000
Trade Receivables at January 1, 2018. 5,103,000
Bad debt written off 71,000
A consignment of foods sent from Benin to Lagos on 31st December invoiced price #750 was not received till 15th January, 2018 and was not included in inventory.
Required :
a. Prepare the necessary ledger account
b. Prepare profit and loss statement for the year 31st December,2018