Branch stock account is used to determine the - WAEC Accounting 2012 Question
Branch stock account is used to determine the
A
net value of goods sent to branch
B
gross profit of the branch
C
branch credit sales
D
branch net profit or loss
correct option: d
This account records the transactions in regard to the stock in the branch at invoice price. The debit side of this account records the inflow of stock into the branch and credit side records its outflow from the branch.
The primary objectives of branch accounting are better accountability and control since profitability and efficiency can be closely tracked for individual locations. The head office is able to ascertain the profits and losses of each branch and compare results.
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