Académique Documents
Professionnel Documents
Culture Documents
Home Office
Cash
1. Home office initial investment for establishing a
branch
Investment in Branch
Cash
xx
2.
Equipment
Cash
No entry
3.
3. Subsequent depreciation
Depreciation Expense
xx
Accum. Dep Equipment
xx
No entry
4.
xx
Home office
Cash
Equipment - Branch
Investment in Branch
5.
xx
xx
xx
Sales - Agency
xx
xx
xx
xx
xx
xx
Depreciation Expense
Home office
5. Subsequent depreciation
xx
xx
xx
xx
Furniture
Cash
7.
xx
xx
Depreciation Expense
Home office
7. Subsequent depreciation
Sales Agency
xx
Cost of Sales Agency
xx
Various expenses
- Agency
xx
Income Summary Agency
xx
Investment in Branch
xx
Accum. Dep. Equipment
xx
6.
No entry
- Branch
xx
xx
xx
xx
8.
xx
Furniture
Home office
Investment in Branch
Cash
9.
9. Subsequent depreciation
xx
xx
Investment in Branch
xx
Accum. Dep. Equipment
No entry
Various expenses
Cash on Hand
xx
xx
xx
Home office
xx
xx
xx
xx
Depreciation Expense
xx
Accum. Dep Equipment
Home Office
xx
No entry
10. HO transfers inventory. Freight paid by HO
Branch
1.
Investment in Branch
Shipments to Branch
Cash
xx
xx
xx
xx
xx
Shipments from HO
Freight-in
Home Office
Cash
xx
xx
Profit
xx
*Individual profit are computed in billed price
xx
xx
12.
Home Office:
12. Purchase of inventory by the Branch from
outsider. Branch paid the Freight.
No entry
Purchases
Freight-in
Accounts Payable
Cash
xx
xx
No entry
xx
xx
13.
13. Sales on account of Branch
A/R
xx
Sales
xx
No entry
14.
14. Collection of Branch
Cash
xx
A/R
xx
Branch:
Sales
Inventory (end)
Shipments from HO
Purchases
Freight-in
Expenses
Income Summary
xx
xx
xx
xx
xx
xx
xx
No entry
15.
15. Remittance of branch
Cash
Home Office
Cash
Home Office:
xx
xx
Investment in branch
Income Summary
xx
xx
xx
Investment in branch
xx
16.
Branch:
Various Expenses
Cash
Accrued Expenses
xx
xx
xx
Income Summary
Home Office
xx
xx
Home Office
Investment in branch
Utilities Expenses
General Overhead Expense
Home Office
xx
xx
10.
Shipments from HO
Freight-in
Home Office
11.
xx
xx
xx
xx
xx
xx
Branch
xx
Sales
Cost of Goods Sold:
Inventory, beg.
xx
Shipments from HO(to B) xx
Purchases
xx
Freight-in
xx
TGAS
xx
Less: Inventory, end
xx
Gross Profit
Less: Expenses
Shipments to Branch
xx
Shipments from HO
To compute realized mark-up:
xx
Total mark-up
xx
Less: Unrealized mark-up (Inventory, end) xx
Realized mark-up
xx
xx
To compute the true profit of Branch (Home
Office):
xx
xx
xx
Sales
Cost of Goods Sold:
Inventory, beg.
xx
Shipments from HO(to B) xx
Purchases
xx
Freight-in
xx
xx
TGAS
Less: Inventory, end
Gross Profit
Less: Expenses
Profit
*True profit is computed at cost
xx
xx
xx
xx
Combined Profit
xx
Or
Individual Profit of Home Office
True profit of the Branch
Combined Profit
xx
xx
xx