R 60 000 40 000 Given information for questions 19 to 20: The following information pertains to the head office and the branch of Ukhozi Sneakers. Branch inventory on hand at selling price 1 October 2018 30 September 2019 Transactions of the branch for the year ended 30 September 2019 R Inventory transferred to the branch (selling price). 188 500 Credit sales at the branch... 285 530 Settlement discount granted to branch debtors 2 433 Branch administrative expenses paid by head office 17 375 Damaged inventory written off (at cost)..... 3 200 Additional information (a) Inventory is purchased by the head office and supplied to the branch at selling price, which is cost price plus 25% (b) The branch held a clearance sale during June 2019. Inventory was sold at selling price less 30% The proceeds of the sale amounted to R49 250 and were included in the credit sales amount of R285 530 as indicated above. TURN OVER 11 FAC1601/RFA1601 MAY JUNE 2020 QUESTION 19 (3 marks) Which of the following represents the correct amounts for branch adjustment (mark-down on sales) and branch adjustment (mark-down on cost) in the branch inventory account as at 30 September 2019 after taking the additional information into account? 1. Branch adjustment (mark-down on sales) R12 313: Branch adjustment (mark-down on cost) R21107 2 Branch adjustment (mark-down on sales) R14 071: Branch adjustment (mark-down on cost) R7 036 3. Branch adjustment (mark-down on sales) R7 036; Branch expenses (mark-down on cost) R14 071 4. Branch adjustment (mark-down on sales) R14 071: Branch expenses (mark-down on cost) R7 036 QUESTION 20 (5 marks) Assuming the correct amount for branch adjustment (mark-down on sales) and branch adjustment (mark-down on cost) are R12 000 and R6 000 respectively. Which of the following represents the correct surplus/(deficit) in the branch inventory account as at 30 September 2019 after taking the additional information into account? 1. R 59 030 surplus 2. R 98 230 surplus 3. R 40 230 deficit 4 R 99 030 surplus