Illustration of double entry-branches, Financial Accounting

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Illustration of double entry
The balances on the current accounts of a head office and branch were Ksh 698,000, before the transactions listed below:

 

Kshs

Goods sent to branch by head office

1,727,000

Remittances received by head office from branch

892,000

Goods received by branch from head office

1,620,000

Remittances sent to head office by branch

944,000

Branch profit for the period

594,000

Goods in transit from head office to branch

107,000

Cash in transit from branch to head office

52,000

 

Books of head office:

                                          Branch Current A/C

 

Sh

 

Sh

Bal b/d

698,000

Cash book

892,000

GSTB

1,727,000

Bal c/d

*1,533,000

 

2,425,000

 

2,425,000

Bal b/d

1,533,000

Goods in transit

107,000

Branch profit

594,000

Cash in transit

52,000

 

________

Bal c/d

1,968,000

 

2,127,000

 

2,127,000

 

*  Entry that is usually found in the trial balance of the Head Office.

 

                                         Goods sent to branch

 

Sh

 

Sh

 

 

Branch current a/c

1,727,000

 

                                              Goods in transit

 

         Sh

 

Sh

Branch current a/c

107,000

 

 

 

                                             Cash in transit

 

     Sh

 

Sh

Branch current a/c

52,000

 

 

 

Books of the branch:

                                    Head office current account

 

Sh

 

Sh

Cash book

944,000

Bal b/d

698,000

Bal c/d*

1,374,000

 

1,620,000

 

2,318,000

 

2,318,000

 

 

Bal b/d

1,374,000

Bal c/d

1,968,000

Branch profit

594,000

 

1,968,000

 

1,968,000

 

*  Entry that is usually found in the trial balance of the branch.

 

                                     Goods from head office

 

     Sh

 

Sh

H.O current a/c

1,620,000

 

 


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