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Book 1 FG

1) The document summarizes the accounting entries recorded in the home office and branch books for transactions between the two. 2) It shows debits and credits to various asset, liability, equity, revenue and expense accounts related to transfers of equipment, cash, inventory between the home office and branch. 3) The document reconciles differences between the balances of "Investment in branch" in the home office books and "Home office" in the branch books after adjusting for unrecorded transactions.

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Arlene Diane Orozco
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58 views14 pages

Book 1 FG

1) The document summarizes the accounting entries recorded in the home office and branch books for transactions between the two. 2) It shows debits and credits to various asset, liability, equity, revenue and expense accounts related to transfers of equipment, cash, inventory between the home office and branch. 3) The document reconciles differences between the balances of "Investment in branch" in the home office books and "Home office" in the branch books after adjusting for unrecorded transactions.

Uploaded by

Arlene Diane Orozco
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Home Office

(Branch’s books)
CREDIT DEBIT
Initial investment from HO
Assets transfer to home office Asset received from home office
Loss Profit
Liabilities and expenses incurred
Home Office (Branch's books)
Debit Credit
P2,900,000
Equipment transfer to home office A2 P200,000 35,000 B1
20,000 A2
9,000 B2
150,000 C
100,000 D
5,000 C
12,000 G
Cash transfer to Home office (remittance) 75,000
P2,940,400
ooks)
Credit
Initial investment from Home Office
Furniture received from Home Office
Depreciation expense incurred

Inventory received from Home Office

Freight-in
Expenses allocated from Home Office
Profit
Equity balance in branch's books
Assets acquired by Carried in Costs
Acquisition
Branch Branch Books
Depreciation
Acquisition
Branch Home office books
Depreciation
Acquisition
Home Office Branch Books
Depreciation
Acquisition
Home Office Home office books
Depreciation
"Investment in branch" account (Home office books "Home Office" account (Branch books)
No movement No movement

Reduction (cr) Reduction (dr)


Addition (dr) Addition (cr)
Addition (dr) Addition (cr)
No movement No movement
No movement No movement
Addition (dr) Addition (r)
Home office books Branch Books
Cash (144,000 x 90%) P129,600 Home Office
Investment to branch P129,600 Cash
General overhead expense 2,000 Home office (HO)
*(110,000 x 120%) Cash
Branch Books
P129,600
P129,600
P12,000
2,000
Home office books Branch Books
Operating expenses P50,000
No Entry Cash P25,000
Accounts Payable 25,000
Freight-in P1,000
No Entry
Cash P1,000
Home Office Books Branch Books
Sales
Inventory
Shipment from HO (C,D)
Purchases €
Freight-in (C,D,E)
No Entry
Depreciation expense (A,B)
Utilities Expense (G)
General overhead exp (G)
Operating expenses (F)
Income Summary
anch Books
P460,000
24,000
P250,000
20,000
11,000
66,000
10,000
2,000
50,000
75,000
Books Account Amount
Home Office books "Investment in branch P126,000
Branch books "Home office" 67,200
Investment in branch (Home Office's books)
Unadjusted balances P126,000
A) Shipment in Transit
B) Collection of receivables
C) Return of damaged merchandise 20,000
D) Unrecorded remittance 10,000
E) Allocation of cost recorded twice
F) Mathematical mistake in recording
Adjusted balance P96,000
Home Office (Branch's books
P67,200
50,000
30,000

2,000
10,800
P96,000
Investment in branch Home office
(Home Office's books) (Branch's books)
Shipments to Branch P20,000 Shipments from HO P50,000
Cash 10,000 Freight-in 10,800
Investment in branch P30,000 Accounts receivable P30,000
Overhead expense 2,000
Home office 28,800

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