A branch office allowed to make sales, carry inventory for resale to customers, and incur normal operating expenses. The home office ships merchandise to the branch office at cost plus a 20% markup. The home office account is used in its customary fashion, it will track: A. Unrealized inventory profits and overall branch profits losses B. Unrealized inventory profits only C. Overall branch profits and losses but not unrealized inventory profits D. Unrealized inventory profits and overall branch profits but not branch losses

Q: The following information is extracted from the books and records of Elaine Company and its branch.…

A: Meaning of Branch Accounting  Branch Accounting is a system in which separate books of accounts are…

Q: Home Office Books Branch Books P 360,000 119,880 Shipments to branch Allowance for overvaluation of…

A: Following is the Branch Inventory on January represents purchases from outsiders: Purchases from…

Q: Karla Company provided the following information for the current year: Purchases Purchase returns…

A: A firm, at the end of the period, prepares financial statements in which income statement is…

Q: The Information below relates to sales transactions for SALALAH Enterprises. Determine the net sales…

A: Net sales = Gross sales - Sales discount - Sales return and allowances Net purchases = Purchases +…

Q: On June 10, Culver Company purchased $8,700 of merchandise on account from Concord Company, FOB…

A: Journal entries are used by the management to record the transactions in the books of accounts.…

Q: Branch: - Inventory costing P51,600 was sent to the branch by the home office on December 31, 20…

A: Investment is the amount which is spent by the producer for the purchase of those goods which…

Q: On June 10, Sunland Company purchased $7,800 of merchandise from Blossom Company, terms 4/10, n/30.…

A: Journal Entries - Journal Entries are the primary record of the transaction entered into by the…

Q: The following merchandise transactions occured in december. Both companies use a perpetual inventory…

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Q: Hair World Incorporated is a wholesaler of hair supplies. Hair World uses a perpetual inventory…

A: Cost of goods sold = Cost of goods sold for cash + Cost of goods sold on account - goods returned  =…

Q: Concord Inc. is a retailer using a perpetual inventory system. All sales returns from customers…

A: As per the definition of perpetual inventory system , inventory counting is done continuously and…

Q: Hair World Inc. is a wholesaler of hair supplies. Hair World uses a perpetual inventory system.…

A: The profit a company makes after deducting all of the expenses involved in producing and offering…

Q: On June 10, Oriole Company purchased $6,400 of merchandise from Ivanhoe Company, terms 2/10, n/30.…

A: The perpetual inventory system records and updates the inventory after each and every transaction.…

Q: YE Company ships inventory to its branch at a mark-up of 125% of cost. The required balance of the…

A: Some time , head office sent the goods to branch at price over the cost price for which the head…

Q: Prepare the cost of goods sold section for Adams Gift Shop. The following amounts are known:…

A: Cost of goods sold is an expense account, which will be reported on the income statement.

Q: The Ang KonTi Manufacturing Co. of Quezon City opened a branch at Davao City on January 1, 1988, to…

A: under periodic inventory method, closing inventory are valued at invoice price-margin

Q: Assume Anderson’s General Store bought, on credit, a truckload of merchandise from…

A: Purchase discount = (Purchases - Purchase return) x discount rate = ($23,000 - $1,200) x 2% = $436

Q: The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. Nelson…

A: Supplies used=Supplies in hand during the year-In hand at end=5,100-2,800=2,300

Q: Presented below are items taken from the unadjusted trial balance of the Company and its branch on…

A: Answer -  Working Note : i. Beginning inventory from HO, at cost (11,880 / 30%) = P 39,600.   ii.…

Q: he following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. Nelson…

A: current ratio is current assets divided by current liabilities Gross profit ratio= Gross profit/net…

Q: On June 10, Cullumber Company purchased $7,300 of merchandise from Oriole Company, terms 3/10, n/30.…

A: A journal entry is a form of accounting entry that is used to report a business transaction in a…

Q: Journalize the following transactions for Cox Company using the gross method of accounting for sales…

A: The journal entries keep the record for inventory on different basis such as perpetual or periodic.

Q: On June 10, Cullumber Company purchased $7,300 of merchandise from Oriole Company, terms 3/10, n/30.…

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Q: How much is the Inventory on January 1 of the Branch that came from the Home Office?

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Q: The home office uses a loading account. If the loading account is used in its customary fashion, it…

A: When goods are shipped to branch at invoice price ( ie cost price + markup), the head office will…

Q: On June 10, Sunland Company purchased $7,800 of merchandise from Blossom Company, terms 4/10, n/30.…

A: Solution: The problem relates to prepare journal entry in the books of seller. To record a sales on…

Q: Goods costing $21,000 were sold for $52,000 on account. The entry to record this transaction would…

A: When goods are sold to customers, then accounts receivable is debited and Sales is credited. To…

Q: Waterway Inc. is a retailer operating in British Columbia. Waterway uses the perpetual inventory…

A: Calculation under LIFO Date   Units Amount Amount           Jan 1 Opening  100 21 2,100…

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A: Here Student asked for Multi sub part question we will solve first three sub part question for you.…

Q: Description   The following information is available for Inverness Ltd.’s second year in business:…

A: Accounts Receivables are those persons to whom business has made credit sales on account and amount…

Q: The home office sells merchandise to its branch at 120% of cost. The branch was established several…

A: Lets understand the basics. When home office shipped goods to branch office which exceeds its cost…

Q: Piper Specialty Store Ltd. completed the following merchandising transactions in the month of May…

A: The refund liability = 2% FOB shipping point means the buyer pays the freight charges. FOB…

Q: USCO Inc. is a retailer operating in many parts of the world. JUSCO uses the perpetual inventory…

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Q: Selected information from the trial balances for the home office and the branch of Lalay Company at…

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Q: ZKABAN bills its branch for merchandise shipments 25% of sale. As of cut-offf date, December 31,…

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Q: You have been assigned the task of evaluating Mariano, ’s management of merchandise inventory and…

A: Note: In this question, the amount of Beginning accounts receivable and ending accounts receivable…

Q: Tempo Ltd. is a retailer operating in Dartmouth, Nova Scotia. Tempo uses the perpetual inventory…

A: The cost of goods sold is calculated by adding the beginning inventory and purchases to obtain the…

Q: On December 3, Blossom Company sold $591,000 of merchandise to Crane Co., terms 1/10, n/30, FOB…

A: Introduction: Credit terms are given to customers to encourage timely and quicker payment of the…

Q: Crane Inc. is a retailer operating in British Columbia. Crane uses the perpetual inventory system.…

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Q: Garth Company sold goods on account to Kyle Enterprises with terms of 2/10, n/30. The goods had a…

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Q: PROBLEM 1: AAA Company provided you with the following data with respect to its inventory: Items…

A: Each item of the above list should be analyzed to decide that whether it should be the part of…

Q: Concord Inc. is a retailer using a perpetual inventory system. All sales returns from customers…

A: As we know that perpetual inventory system is a sustem in which inventory is country continuously…

Q: [The following information applies to the questions displayed below.]   Hughes Hair Design is a…

A: Periodic inventory system means where day to day in or out of goods is not recorded and value of…

Q: Selected information from the trial balances for the home office and the branch of Lalay Company at…

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Q: Cute Company operates a branch in Baguio City. Selected balances taken from the books of Home Office…

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Q: The following information is available for Jaworski second year in business: • Opening merchandise…

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Q: Journalize the following transactions for Jackson Company using th gross method of accounting for…

A: The journal entries are prepared to record day to day transactions of the business on regular basis.

Q: Crane Inc. is a retailer operating in British Columbia. Crane uses the perpetual inventory system.…

A: 1. Last-in, first-out (LIFO) cost flow assumption - Under LIFO Method, Inventory purchased last is…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.