The Inventory in the Branch at the end of the period is 60,000. Prepare the income statement and determine the Branch profit for the first 3 month of its operation. Use the journal entry for reference. Home Office BookBranch BookCr.| 680,000Dr.Dr.Cr.1 Investment in branchCash400,000400,000180,000100,000 EquipmentCashHome office400,000EquipmentFurnitures & fixtures180,000Home Office180,000*Depreciation Expense8,550Accumulated Depn.8,550Furniture & FixturesHome Office100,000100,000*Depreciation Expense2,375Accumulated Depn.2,3752 Equipment80,000No entryCash80,000*Depreciation Expense3,800Accumulated Depn.3,8003 No EntryPurchases160,000Freight-in3,00083,00080,000CashAccounts payable4 No EntryTable and Chairs20,000Freight-in800Cash20,8005 Computers and printers110,000No EntryCash110,006 Investment in branch320,000Shipments from Home office320,000Shipments to branch320,000Home office320,000Freight-in5,000Cash5,0007 No entryCash100,000Accounts Receivable600,000Sales700,0008 Cash100,000Home office100,000Investment in branch100,000Cash100,0009 No entryCash460,000Accounts Receivable460,00010 No EntryAdvertising expenseOffice supplies expense10,0003,000Cash13,00011 No EntrySalaries expense80,000Cash80,000Utility expense6,000Utilities payable6,00012 Cash300,000Home office300,000Investment in branch300,000Cash300,000

Profit refers to the net revenue earned by a business from its operations. This amount is determined…

Branch Book Dr. Cr. Cash 400,000 Home office | 400,000 Equipment 180,000 Home Office 180,000 *Depreciation Expense Accumulated Depn. 8,550 8,550 Furniture & Fixtures Home Office 100,000 100,000 *Depreciation Expense Accumulated Depn. 2,375 2,375 No entry Purchases 160,000 Freight-in 3,000 Cash 83,000 Accounts payable 80,000 20,000 800 Table and Chairs Freight-in Cash 20,800 No Entry Shipments from Home office Home office 320,000 320,000 Cash Cash 100,000 | 600,000 Accounts Receivable Sales 700,000 Home office 100,000 Cash 100,000 Cash 460,000 Accounts Receivable 460,000 Advertising expense Office supplies expense 10,000 3,000 Cash 13,000 Salaries expense 80,000 Cash 80,000 Utility expense 6,000 Utilities payable 6,000 Home office 300,000 Cash 300,000

Branch Book Dr. Cr. Cash 400,000 Home office | 400,000 Equipment 180,000 Home Office 180,000 Depreciation Expense Accumulated Depn. 8,550 8,550 Furniture & Fixtures Home Office 100,000 100,000 Depreciation Expense Accumulated Depn. 2,375 2,375 No entry Purchases 160,000 Freight-in 3,000 Cash 83,000 Accounts payable 80,000 20,000 800 Table and Chairs Freight-in Cash 20,800 No Entry Shipments from Home office Home office 320,000 320,000 Cash Cash 100,000 | 600,000 Accounts Receivable Sales 700,000 Home office 100,000 Cash 100,000 Cash 460,000 Accounts Receivable 460,000 Advertising expense Office supplies expense 10,000 3,000 Cash 13,000 Salaries expense 80,000 Cash 80,000 Utility expense 6,000 Utilities payable 6,000 Home office 300,000 Cash 300,000

Quickbooks Online Accounting

3rd Edition

ISBN:9780357391693

Author:Owen

Publisher:Owen

Chapter6: Investing And Financing Activities

Section: Chapter Questions

Problem 4.5C

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Home office BranchSales P 365,000 P174,000Shipment to branch 90,000Purchases from outsiders 220,000 35,000Advertising expense 13,700 2,500Salaries and Commission 35,000 9,500Rent Expense 10,000 2,000Miscellaneous expense 3,300 500Shipment from home Office 112,500Inventories, January 1:Home Office 85,000Branch:From outsiders 9,500From home office at 2018 billed price30,000Inventories, December 31:Home Office 65,000BranchFrom outsider 6,500From Home office at 2018 billed price30,0001. The branch inventory at cost on December 31, 2021 is:a. P30,500 c. P70,000b. 31,500 d. 36,5002. The combined net income of the Home Office and the Branch on December 31, 2021 is:a. P111,000 c. P250,500b. 63,000 d. 174,000
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