On December 31, 2020, the Branch Current in the Home Office books shows a balance of P50,000. The following facts are ascertained:Merchandise billed at P 12,500 is in transit on December 31 from the home office to the branch.The branch collected a home office accounts receivable for P3,500. The branch did not notify the home office of such collection.On December 30, the home office sent cash of P7,500 to the branch, but this was charged to general expense; the branch has not received the cash as of December 31.Branch profit for December was recorded by the home office at P2,400 instead of P2,040.The branch returned supplies of P1,500 to the home office but the home office has not yet recorded the receipt of the supplies. Assume all other transactions have been properly recorded. What is the unadjusted balance of the Home Office Current account on the branch books on December 31, 2020?

In Branch Accounting It is a general practice to prepare a Reconciliation account to arrive at the…

Answered: On December 31, 2020, the Branch…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On December 31, 2020, the Branch Current in the Home Office books shows a balance of P50,000. The following facts are ascertained:

Merchandise billed at P 12,500 is in transit on December 31 from the home office to the branch.
The branch collected a home office accounts receivable for P3,500. The branch did not notify the home office of such collection.
On December 30, the home office sent cash of P7,500 to the branch, but this was charged to general expense; the branch has not received the cash as of December 31.
Branch profit for December was recorded by the home office at P2,400 instead of P2,040.
The branch returned supplies of P1,500 to the home office but the home office has not yet recorded the receipt of the supplies.

Assume all other transactions have been properly recorded. What is the unadjusted balance of the Home Office Current account on the branch books on December 31, 2020?

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