PRIA AFAR03003 Corporate Liquidation and Home Office and Branch Accounting No Answer

PHILIPPINE REVIEW INSTITUTE FOR
ACCOUNTANCY
3rd Floor Elizabeth Center Building
Barangay Putatan, Muntinlupa City
ADVANCED FINANCIAL ACCOUNTING AND REPORTING

(AFAR)
Corporate Liquidation
Agency Accounting
Home Office and Branch Accounting
BATCH 3 – May 2019 AFAR03003

AFAR03003
Contents
L E C T U R E N O T E S .......................................................................................... 1
CORPORATE LIQUIDATION ............................................................................................... 1
AGENCY, HOME OFFICE and BRANCH .............................................................................. 2
L E C T U R E P R O B L E M S ............................................................................. 4
STATEMENT OF AFFAIRS .................................................................................................. 4
Recovery Ratio ............................................................................................................. 4
Partially Secured Liability ............................................................................................. 4
Unsecured, Non-Priority Claims ................................................................................... 5
Estimated Deficiency .................................................................................................... 6
ACCOUNTING FOR RECEIVERSHIP .................................................................................... 9
Liquidation & Realization Account ............................................................................... 9
Pro-rate Payment ......................................................................................................... 9
Ending Cash Balance................................................................................................... 10
AGENCY ACCOUNTING ................................................................................................... 11
ACCOUNTING FOR HOME OFFICE & BRANCH TRANSACTIONS ...................................... 12
The Reciprocal Accounts ............................................................................................ 12
Inter-branch Transactions .......................................................................................... 13
Shipments to Branch at Billed Price ........................................................................... 13
Shipments at Billed Price & Purchase from Outsiders ............................................... 14
Combined Net Income ............................................................................................... 17
Home Office with Multiple Branch ............................................................................ 18
Reconciliation of Reciprocal Accounts ....................................................................... 19
D O - I T - Y O U R S E L F ..................................................................................... 22
NOTES ............................................................................................................................. 30
Batch 3 – May 2019 Page 2

Lecture Notes
L E C T U R E N O T E S
CORPORATE LIQUIDATION  Unsecured without priority
 Fully secured liability
Under Insolvency Act of the Philippines,  Partially secured liability
insolvency may be:  Unsecured without priority
 Voluntary
 Involuntary The following may be derived from the
foregoing classifications:
Possible recourse of an insolvent  Additional free assets = Assets pledge to
corporations: fully secured creditors – fully secured
 Corporate Liquidation liability
 Reorganization  Additional unsecured without priority
claims = partially secured liability –
Corporation Liquidation process: assets pledge to partially secured
1. Assets are converted into cash liability
2. Liabilities are settled  Net free assets = total free assets –
3. Remaining amount is given to the unsecured with priority
owners  Recovery ratio = net free assets divide
by total unsecured without priority
Measurement basis
 Conceptual framework and IFRS are not Statement of Realization and Liquidation
applicable A statement showing the affairs of the
 Measurement is based on realizable liquidating entity in the hands of a receiver.
amount.
Depicted like a t-account
Financial Reports
Statement of Affairs Realization and Liquidation
Prepared at the start of liquidation showing Assets to be realized Assets realized
the financial position of the liquidating Assets acquired Assets not realized
entity – assets available for distribution and Liabilities liquidated Liabilities to be
the claims of creditors. liquidated
Liabilities not Liabilities assumed
liquidated
Assets are classified into: Supplementary Supplementary
 Assets pledge to fully secured creditors debits credits
 Assets pledge to partially secured
creditors Note: the resulting amount shall be
 Free assets reported and closed to retained earnings as
gain/loss.
Liabilities are classified into:
Mercado/Magumun/Reyes/Tubay Page 1
AFAR03003
Assets classification: statements are being
 Assets to be realized – excluding cash, combined to the
presented at book value. These are home office
available for disposal as of the
beginning of the period. Accounting for agency
 Assets acquired – new assets or Since the agency does not have its own
additional assets books, the home office records all the
 Assets realized – actual net proceeds. transaction of the agency in its own books
 Assets not realized – assets unsold at with specific distinction to separate the
the end of the period measured at book accounts of the agency from the accounts of
value. the home office.
Classification of liabilities: Accounting for Branch

The branch maintain its own records,
 Liabilities to be liquidated – presented
however, their financial statements are
at book value. These are liabilities as of
being combined with the home office for
the beginning of the period.
external reporting purposes.
 Liabilities assumed – new liabilities or
additional liabilities
Reciprocal accounts
 Liabilities liquidated – actual net
The account used by the home office and
settlement of liabilities.
branch to link all the transactions to each
 Liabilities not liquidated – liabilities at
other.
the end of the period at book value
HOME OFFICE BOOKS
AGENCY, HOME OFFICE and BRANCH Investment in Branch
AGENCY BRANCH Assets transfer to BR Assets received from
Display merchandise Carries stocks of branch
and take customer merchandise. Profit of branch Loss by branch
order but do not Provides goods and Liabilities and AR of BR collected by
carry stock of services similar to expense by BR paid HO
merchandise Home Office by HO
Customers’ orders Grants credit terms
are sent to home within company The account is not limited to the
office for approval policies.
transactions listed above. It has a normal
Holds revolving cash Has its own assets
balance of debit.
fund and able to incur its
own liabilities
Not a separate entity. Accounted for
Viewed as an separately. Had a
extension of the complete set of
home office books. For external
reporting purposes,
branch’s financial

Lecture Notes
BRANCH BOOKS realized allowance to get the branch true
Home Office Equity net income.
Assets transfer to Assets received
BR from branch Inter-Branch transfer
Profit of branch Loss by branch The home office may instruct the branch to
Liabilities and AR of BR collected transfer certain assets to another branch.
expense by BR paid by HO Doing so, the receiving branch shall record
by HO the receipt of the asset as if it came from the
The account is not limited to the home office.
transactions listed above. It has a normal
balance of credit. Custody of fixed assets
The custody of fixed assets will always be on
These reciprocal account should always be the account of branch but the records may
in balance at all time. If it happened that it is be given to the branch or the home office. If
not in balance, a reconciliation shall be the recording of the fixed assets will be in
prepared to adjust for possible the books of branch, there is no problem.
discrepancies. But, if the recording is on the books of home
office, the branch will only record the
Transfer of inventories depreciation expense related to the asset.
The home office may transfer inventories While the accumulated depreciation shall be
to/from their branch. The accounting on the account where the asset is recorded.
depends on the inventory system used by
the companies. If they used periodic
inventory system, the home office will use ******end of lecture notes******
the Shipments to Branch account which is a
reduction of inventory while the branch will
use Shipments from home office account
which is similar to a purchases. If perpetual
inventory system was used, simply use the
merchandise inventory account.
The transfer of inventory may be at cost or

at billed price. There will be no problem if
the transfer was at cost. If the transfer is
based on billed price, the home office will
record the difference between the billed
price and cost as an Allowance for
Overvaluation of Branch Inventory. This
represents the unrealized gain attached on
the unsold inventory in the hands of the
branch. Once sold, it will be presented as a
AFAR03003
L E C T U R E P R O B L E M S
STATEMENT OF AFFAIRS
Recovery Ratio
1. The unsecured creditors of NALU-Gi Corporation filed voluntary bankruptcy petition on July
1, 2019. The court order for relief was granted on July 10 at which time an interim trustee
was appointed to supervise liquidation of the corporation. A listing of assets and liabilities of
NALU-Gi Corporation as of July 10, 2019, along with estimated realizable value is as follows:
Estimated
Book value Current Value
Cash P80,000 P80,000
Accounts receivable – net 210,000 160,000
Inventories 200,000 210,000
Equipment – net 150,000 60,000
Land and buildings – net 250,000 140,000
Intangible assets 10,000
P900,000 P650,000
Accounts payable P350,000
Notes payable 100,000
Wages payable (June and July) 24,000
Taxes payable 126,000
Mortgage payable P200,000, plus
P5,000 unpaid Interest on July 10 205,000
Capital stock 300,000
Retained earnings (deficit) (205,000)
P900,000
Additional information:
1. Accounts receivable are pledged as security for the notes payable.
2. No more than P1,000 is owed to any employee.
3. Taxes payable are a priority item.
4. The mortgage payable and interest are secured by land and buildings.
5. Trustee fees and other costs of liquidating the estate are expected to be P11,000.
Determine the expected return on the peso for unsecured non-priority claims:
A. P0.60 C. P0.75
B. P0.62 D. P0.98
Partially Secured Liability

2. UWE-NA Company filed a voluntary bankruptcy petition on July 15, 2019 and the statement
affairs reflects the following amounts:

Book Estimated
Carrying Current
Amount Value
Assets
Assets pledged with fully secured creditors P160,000 P190,000
Assets pledged with partially secured creditors 90,000 60,000
Free assets 200,000 140,000
Liabilities
Liabilities with priority 20,000
Fully secured creditors 130,000
Partially secured creditors 100,000
Unsecured creditors 260,000
Assume that the assets are converted into cash at the estimated current values and the
business is liquidated.
What total amount of cash should partially secured creditors receive?
A. P60,000 C. P90,000
B. P84,000 D. P100,000
3. The Statement of Affairs for WAPERA CORPORATION shows that approximately P0.78 on the
peso probably will be paid to unsecured creditors without priority. The corporation owes
MAPERA COMPANY P23,000 on a promissory note, plus accrued interest of P940. Inventories
with a current fair value of P19,200 collateralize the note payable. Compute the amount that
the MAPERA COMPANY would receive from WAPERA CORPORATION assuming that the actual
payments to unsecured creditors without priority consist of 78% of total claims. Round all
amounts to the nearest peso.
a. P19,200 c. P33.987
b. P22,897 d. P52.200
Unsecured, Non-Priority Claims

4. WAWENTA Co. filed a voluntary bankruptcy petition on August 15, 2019. The statement of
Estimated
Book Value Current Value
Assets:
Assets pledged with partly secured creditors 180,000 120,000
Free assets 420,000 320,000
P900,000 P810,000
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Liabilities:
Liabilities with priority P70,000
P1,070,000
Assume that the assets are converted to cash at the estimated current values and the
business is liquidated. What amount of cash will be available to pay unsecured nonpriority
claims?
A. P240,000 C. P320,000
B. P280,000 D. P360,000
Estimated Deficiency
5. The following data are provided by AhBaLuGi Corp. which is undergoing liquidation process:
i. Total liabilities amounts to P692,000. 35% is secured by assets amounting to P270,000
with a FMV of P250,000; 40% is-secured by assets amounting to P300,000 with-a FMV
of P225,000.
ii. Total assets amounts to P890,000 and has a total fair market value P695,000.
iii. Unpaid income taxes amounts to P35,000. Additional salaries payable and
administrative expenses totaled P28,000.
How much is the estimated deficiency to unsecured liabilities?
A. P48,000 C. P60,000
B. P54,000 D. P72,000
Comprehensive
THE NEXT ITEM(S) IS/ARE BASED ON THE FOLLOWING
Rauh-Welt Corp. has the following statement of financial position:
ASSETS LIABILITIES and SHAREHOLDERS' EQUITY

Cash 5,000 Note payable (short-term) 97,000
Marketable securities 30,000 Accounts payable 85,000
Accounts receivable 25,000 Accrued expenses 18,000
Inventory 51,000 Note payable (long term) 208,000
Prepaid expenses 3,000 Share capital 95,000
Land 120,000 Retained earnings (deficit) (59,000)
Building 105,000
Equipment 95,000
Intangible assets 10,000 Total Liabilities and
Total Assets P444,000 Shareholders' Equity P444,000

Additional information:
• The note payable is secured by the inventory and the note payable (long term) is secured
by the land and building
• Marketable securities have an appreciated value of P35,000 and dividends of P1,000 are
due from this investment
• Only P15,000 can be collected from the accounts receivable
• Inventory can only be sold at P48,500
• Prepaid expenses include a refund of P1,000, however the intangible assets have no
resale value
• Fair value of the land and building is P238,000 and the fair value of the equipment is
P58,000
• Administrative expenses of P31,500 are estimated as liquidation expenses
• Salaries of P12,000 and payroll taxes of P3,000 are accrued
• Interest on the long term note payable of P8,000 has not been accrued
6. How much is the estimated deficiency?
A. 38,000 C. 43,000
B. 46,000 D. 47,000
7. How much is the estimated recovery percentage?
A. 66.30% C. 65.57%
B. 72.16% D. 67.79%
8. How much are the estimated recovery and the estimated recovery percentage for partially
secured creditors?
A. 83,497.60 and 86.08% C. 80,655.50 and 83.15%
B. 80,301.45 and 82.79% D. 81,378.15 and 83.90%
9. How much is the estimated recovery for unsecured creditors without priority?
A. 63,500 C. 59,655
B. 58,344 D. 57,702
10. What is the amount of net free assets?
A. 98,500 C. 87,500
B. 89,500 D. 90,500
The following information was gathered from the books of BROKE Corporation which is currently
undergoing bankruptcy proceedings:
• Note payable of P97,500 is secured by furniture and equipment with a carrying amount of
P120,000 that is estimated to be 75% realizable.
• A mortgage payable of P192,500 is secured by building valued at P35,000 less that its
carrying amount of P230,000.
AFAR03003
• Assets not mentioned above have an estimated value of P62,500, an amount that is P15,000
above carrying amount.
• Total liabilities not mentioned above total P96,000, including claims with priority of P18,500.
11. How much is the estimated loss on asset realization?

A. 65,000 C. 80,000
B. 50,000 D. 60,000

A. 80.65% C. 54.71%
B. 56.77% D. 51.76%
13. How much is the estimated recovery percentage for partially secured creditors?
A. 96.67% C. 98.51%
B. 96.52% D. 96.29%
Reconstruction of Accounts
LUGUI Corp. is experiencing financial difficulty and is in the process of liquidation. In its statement
of financial position, the mortgage payable of P110,000 is secured by the land with carrying
amount of P100,000 and fair market value of P105,000. Accrued expenses total P15,000 of which
P10,000 represents salaries of employees and the remainder is secured by the inventory with
carrying amount of P20,000 and fair market value of P10,000. Total liabilities reflected in the
statement of financial position amount to P132,000. Estimated payment to partial creditors is
P108,250. The amount of total assets is P135,000.

A. 60% C. 70%
B. 65% D. 75%
15. How much is the estimated deficiency?

A. 4,200 C. 3,000
B. 3,600 D. 4,800
16. How much is the payment to unsecured creditors without priority?

A. 4,900 C. 4,200
B. 5,250 D. 4,550

ACCOUNTING FOR RECEIVERSHIP
Liquidation & Realization Account
17. A statement of realization and liquidation has been prepared. The totals are as follows:
Assets to be realized P80,000
Assets acquired 40,000
Assets realized 30,000
Assets not realized 90,000
Liabilities to be liquidated 80,000
Liabilities assumed 50,000
Liabilities liquidated 100,000
Liabilities not liquidated 30,000
Supplementary credits 110,000
The ending balances of capital stock and retained earnings are P100,000 and P18,000,
respectively. Retained earnings increased by P12,000.
How much were recorded as supplementary charges during the same period?
A. P22,000 C. P98,000
B. P86,000 D. P122,000
18. The following data are taken from the statement of realization and liquidation:
Increase in assets 45,000
Liabilities to be paid 178,000
Increase in liabilities 23,400
Liabilities paid 145,000
Liabilities not paid ?
Supplementary charges 35,000
How much is the net gain or loss?
A. (99,800) C. 43,000
B. (43,000) D. 99,300
Pro-rate Payment
19. The statement of affairs of JEREMIAH CORPORATION, shows the following:
Estimated gains on realization of assets P 1,280,000
Estimated losses on realization of assets 2,244,000
Additional assets 1,000,000
Additional liabilities 300,000
Capital stock 2,000,000
Deficit 900,000
AFAR03003
The pro-rata payment on the peso, to stockholders, is:
a. P0.78 c. P0.76
b. P0.43 d. P0.75
Ending Cash Balance
20. The following data were taken from the statement of realization and liquidation of ABC Corp.
for the quarter ended June 30, 2012
Liabilities assumed 281,250
The ending capital balances of capital stock and retained earnings are P648,750 and
P178.500, respectively. A net loss of P226,500 for the period. How much is the ending
balance of cash?
A. P807,000 C. P1,125,000
B. P978,750 D. P1,260,000
Comprehensive
SARADO NA Corp. has the following balances in July 1, 2015:
Cash 5,500 Accounts payable 59,500
Accounts receivable 35,000 Wages payable 25,000
Inventories 60,000 Tax payable 35,000
Notes receivable 78,000 Note payable 65,000
Equipment 256,000 Mortgage payable 175,000
Share capital 120,000
Deficit (45,000)
Total 434,500 Total 434,500
In the statement of realization and liquidation the following data are ascertained for the month
of July:
The note payable and mortgage payable together with their respective interests are paid. Only
7/8 is collected from the existing account receivable at the beginning of the month. Half of the
Inventories were sold for P45,000. Only P68,500 of the notes receivable is collected. Equipment
is sold for P225,000. Administrative expenses of P13,800 are paid. Additional credit sales
amounting to P10,500 are made for the remaining inventories. Interests accrued for the month
are note receivable P1,500, note payable P5,500 and mortgage payable P10,500. All existing
noncash assets at the beginning of the month are sold or collected during the month.
21. How much is the profit or loss in the statement of realization and liquidation?
A. (42,475) C. (77,675)
B. 27,975 D. 75,175
22. How much is the estate equity at July 31, 2015?

A. (102,975) C. 150,175
B. 32,525 D. (2,675)
AGENCY ACCOUNTING
PRIA Company established an agency in BATANGAS and the agency revenues and expenses are
recorded using specific agency accounts:
a. Merchandise sample shipped to BATANGAS Agency, 15,000.
b. A working fund of 10,000 was transferred to the agency manager.
c. A list of sales order was sent by the agency manager to be filled up by the home office,
60,000. Terms: n/10.
d. Cost of shipment to agency customers, 35,000.
e. Working fund replenished for the following agency expenses: rent, 1,000; supplies, 500;
salaries, 2,000; and utilities, 500.
f. Samples used up amounted to 10,000.
REQUIRED:
23. Compute for the agency’s net income.
24. Journalize the transactions.
25. PRIA, Inc. opened a sales agency in San Pedro Laguna in 20x1. The following is a summary of
the transactions of the sales agency:
Sales orders sent to home office ......................................................................... P120,000
Sales orders filled by home office in 20x1............................................................... 95,000
Freight on shipment of agency ................................................................................... 2,000
Collections, net of 10% discount .............................................................................. 81,000
Selling expenses paid from the agency working fund ............................................. 5,500
Administrative expenses charged to agency ........................................ 5% of gross sales
Samples shipped to agency:
Cost ................................................................................................................................. 8,200
Inventory, December 31, 20x1 ................................................................................... 4,550
The company's gross profit rate on agency sales is 30% excluding the freight cost on shipments
to agency.
What is the total comprehensive income of the agency for 20x1?

a. P3,600 c. P1,600
b. P5,600 d. P6,300
AFAR03003
26. PRIA CORPORATION has several agencies over the country. The home office paid property
insurance expense on behalf of one of the agencies for P6,000. The company follows sound
internal financial procedures.
The afore-mentioned transaction is correctly recorded in the home office books as follows:
A. Accounts receivable-Cebu Agency 6,000
Cash 6,000
B. Cash - Bacolod Agency 6,000
Cash 6,000
C. Insurance expense 6,000
Cash 6,000
D. Insurance expense-CDO Agency 6,000
Cash 6,000
ACCOUNTING FOR HOME OFFICE & BRANCH TRANSACTIONS
The Reciprocal Accounts
PRIA Corporation opened a branch in Manila. Merchandise is shipped at cost and the periodic
inventory system is used. Fixed assets are carried in the Branch books and the Home Office bills
the Branch for the expenses paid on its behalf. The following are the opening balances of the
Home Office on its third year of operation:
Cash 312,000 Accounts Payable 42,000
Accounts Receivable 45,000 Share Capital 375,000
Merchandise Inventory 120,000 Retained Earnings 225,000
Prepaid Expenses 5,000
Property & Equipment 175,000
Accumulated Depreciation (15,000)
Total 642,000 Total 642,000
The transaction of the home office and the branch show the following:
a. Transferred cash of 200,000 and merchandise costing 300,000 to the newly opened
branch in Makati.
b. Equipment amounting to 75,000 is purchased for cash by the home office and then
transferred to Makati branch.
c. Sales on credit: home office, 950,000; branch 600,000.
d. Account purchases: home office, 700,000; branch, 200,000.
e. Payment of expenses: home office, 200,000; branch, 150,000.
f. Branch expenses paid by home office, 25,000.
g. Cash collections: home office, 750,000; branch, 500,000.
h. Branch remitted 200,000 cash to home office.
i. Payment of liabilities: home office, 175,000; branch, 90,000.
j. Merchandise return by branch to home office, 30,000.
k. Merchandise inventory end: home office, 160,000; branch, 150,000.
l. Expired prepaid expenses, 4,000 for home office. Depreciation rate on plant assets, 10%.
Home Office and Branch
REQUIRED:
27. Journalize the following transactions.
28. How much is the Home Office net income?
29. How much is the Branch net income?
30. How much is the consolidated net income?
Inter-branch Transactions
31. The following transactions occurred in the current year:
a. Home office transferred cash to Cebu branch, 10,000.
b. Home office instructed Cebu to transfer 3,000 of its own cash to Davao Branch.
c. Home office shipped goods to Davao branch costing 5,000 and paid freight for
200.
d. Home office instructed Davao to transfer merchandise to Cebu. Cebu paid
freight of 100 for the transfer made. Normal freight from home office to Cebu
is only 150.
REQUIRED:
Journalize the transactions in their respective books.
How much is the excess freight on inter-branch transfer.
32. The PRIA Corporation has two branches, Branch P and Branch Q. The home office shipped
P80,000 in merchandise to Branch P and prepaid the freight charges of P500. A short time
thereafter, Branch P was instructed to ship this merchandise to Branch Q at a prepaid freight
cost of P700. Freight charges for this merchandise normally cost P800 when shipped from the
home office directly to Branch Q. Compute the excess freight on transfers of merchandise:
A. P400 C. P700
B. P500 D. P800
Shipments to Branch at Billed Price

PRIA Corporation shipped merchandise to branch billed at 300,000 which is 20% above cost. The
branch returned 30,000 worth of merchandise to the home office. During the year the branch
reported sales of 600,000, purchases of 200,000 and expenses of 182,500. The home office
reported sales of 950,000, purchases of 700,000, expenses of 221,500 and inventory beginning of
120,000. Inventory at the end of the year amounted to 160,000 for the home office and 150,000
for the branch 90,000 of which came from the home office.
REQUIRED:
33. How much is the branch own net income?
34. How much is the home office own net income?
35. As far as the home office is concerned, how much is the branch true net income?
36. How much is the combined net income?
AFAR03003
Allowance for Overvaluation Account
37. PRIA Co. bills merchandise to its branch at 120% of cost. At Dec. 31, 20x1, the branch
reported the following:
Jan. 1 inventory P 33,600
Shipments from home office 840,000
Returns to home office 48,000
Dec. 31 inventory 36,000
Before adjustment, how much would be the balance of the “allowance” for overvaluation
account?
a. P6,000 c. P137,600
b. P9,600 d. P145,600
38. PRIA Company bills its Valenzuela branch for merchandise at 140% of cost. At the end of
January, 20x1, the branch reported the following information:
Merchandise from Home Office
(At Billed Price)
Inventory, January 1 P 7,560
Shipments received 28,280
Inventory, January 31 8,400
What should be the balance of the allowance account for overvaluation of the Branch
inventory at January 31?
a. P2,400 c. P8,080
b. P2,160 d. None of these.
39. A home office transfers inventory to its branch at a 40% markup. During 2003, shipments
from home office in the branch’s books was P210,000. At year-end, the home office adjusted
its Allowance for Overvaluation account downward to P12,500. The branch’s balance sheet
at the beginning of the year shows P49,000 of inventory acquired from the home office.
How much is the cost of goods sold at the branch as far as the home office is concerned?
A. P31,250 C. P204,750
B. P153,750 D. P215,250
Shipments at Billed Price & Purchase from Outsiders

40. PRIA ENTERPRISES retails merchandise through its Main Store and through a branch store.
Both sales outlets have complete sets of books. The branch store purchases merchandise
from outside vendors and also receives merchandise from the main store billed at 120%
of cost. Some selected information from the trial balances offices at December 31 of the
current year are as follows:

Main Store Branch Store
Sales P96,000 P48,000
Shipments to branch store 12,800
Purchases 56,000 8,800
Inventory, January 1 32,000 24,000
Shipments from Main Store -- 15,360
Expenses 22,400 9,600
Allowance for Overvaluation of branch inv. 5,760
December 31 inventories are P32,000 and P16,000 for the main store and the branch
store, respectively. Sixteen percent (16%) of the branch store's ending inventory are from
outside suppliers.
Calculate the net income realized by the Main Store from the Branch Store operations.
A. P 8,480 C. P 12,000
B. P 9,760 D. P 40,160
41. The income statement submitted by the Calamba City branch to the City of Manila Head
Office for the month of March, 20x1 follows:
Sales P 750,000
Less Cost of sales
Inventory, March 1, 20x1 P100,000
Shipment from Home Office 437,500
Purchases from other vendors 37,500
Inventory, March 31, 20x1 (125,000) 450,000
Gross profit P 300,000
Operating expenses 225,000
Net income P 75,000
An analysis of the beginning inventories provided the following:

a. Of the total beginning inventory, 12.50% come from other vendors.
b. Of the total ending inventory, 84.00% come from the head office.
c. The head office consistently bills the branch for merchandise shipments at 140% of cost.
Compute the net income of the branch from the standpoint of combined operations.
A. P100,950 C. P190,500
B. P109,500 D. P195,000
42. The Cagayan Branch of PRIA ENTERPRISES buys merchandise from third parties and receives
merchandise from the home office for which it is billed at 20% above cost. Below are
excerpts from the trial balances and data on the home office and the branch office for the
month just ended.
AFAR03003
Home Office Books
Cr Allowance for overvaluation of branch merchandise P 740,000
Cr Shipment to branch 1,700,000
Branch books
Dr Beginning inventory P2,880,000
Dr Shipment from home office 2,040,000
Dr Purchases from third parties 820,000
Additional information at the month end

Ending inventory of branch P2,920,000
From the home office 2,340,000
From third parties 580,000
Compute the total cost of goods sold by Cagayan branch at cost (net of mark-up) for the
month.
A. P2,407,000 C. P2,700,400
B. P2,470,000 D. P2,704,000
Goods in Transit
Home office bills its branch for merchandise shipments at 30% above cost. The following are some
of the account balances on the books of home office and its branch as of December 31, 20x1:
Home Office Books Branch Books
Shipments from Home Office 263,900
Purchases 1,575.000 350,000
Shipments to Branch 253,750
Branch Inventory Allowance 91,875
Sales 2,100,000 1,260.000
Operating Expenses 507,500 192,500
Per physical count, the ending inventory of the branch is P73.500 including goods from outside
purchases of P48,475; the ending inventory of the home office is P210,000.
43. What is the cost of goods available for sale of the home office?
a. 1,610,000 c. 1,356,250
b. 1,863,750 d. 1,575.000
Billed Price NOT Given

44. PRIA Corporation has operations in two locations-a main plant and a branch plant. The
branch receives most of its inventory from the main plant, but is also purchases some
items from local suppliers. The main plant transfers merchandise to the branch, and
this merchandise are inventoried by the branch at billed prices. The following data for
the year 20x1 are available:

MAIN Plant BRANCH Plant
Inventory, January 1 P126,000 P24,000
Purchases 1,400,000 48,000
Shipments from Home office 360,000
Inventory, December 31 120,000 26,000
One-fourth of the beginning branch inventory was acquired from outside suppliers. The
branch ending inventory includes P5,000 from outside suppliers
What is the cost of goods sold amount to be included in the published income statement for
the year 20x1?
A. P1,452,000 C. P1,454,000
B. P1,452,500 D. P1,106,000
45. Presented below are items taken from the unadjusted trial balance of PRIA, INC. and its
CEBU Branch on December 31, 20x1.
Home Office Branch Office
Shipment to Branch P1,800,000
Deferred Profit 599,400
Shipment from Home Office P2,340,000
Purchases 2,000,000 867,600
Merchandise Inventory, Jan. 1 1,289,925 737,100
Merchandise Inventory, Dec. 31 292,500
Sales 3,840,000
Expenses 900,000 306,000
The branch ending inventory acquired from other vendors had a cost of P58,500. There are
no merchandise shipments in transit at December 31, 20x1.
Calculate the net income (loss) of the branch insofar as the Home Office is concerned.
A. P(147,750) C. P427,200
B. P 315,000 D. P534,000
Combined Net Income

46. The following data were provided by the accountants of the Home Office and Branch for the
year ended December 31, 20x1:
Home Office Book Branch Book
Net sales to outside customer P1,000,000 P800,000
Beginning Inventory 300,000 140,000
Net purchase from outside supplier 800,000 250,000
Shipment to branch 400,000
Shipment from Home Office 500,000
Ending Inventory 100,000 200,000
Operating expense 200,000 100,000
AFAR03003
Additional Notes:
 The current corporate income tax rate is 30%.
 It is the policy of the company to use specific identification for its inventory.
 For the year ended December 31, 20x0, the Home Office bills its branch with a gross
profit rate of 40% based on cost.
 Half of the beginning inventory of the branch was acquired from outside suppliers.
 The ending inventory of the branch is broken down as follows:
 60% from outside supplier
 26% from 20x1 shipment from home office
 14% from 20x0 shipment from home office
What is the combined net income to be presented by the Home Office in its Statement of
Comprehensive Income for the year ended December 31, 20x1?
A. P204,120 C. P218,120
B. P217,000 D. P219,800
Home Office with Multiple Branch

47. Selected balances from the BACOLOD COMPANY'S SILAY BRANCH and TALISAY BRANCH are
as follows:
SILAY BRANCH TALISAY BRANCH

Merchandise Inventory, January 1, 20x1 P16,800 P15,200
Imprest Branch Fund 1,600 1,200
Merchandise Inventory, December 31, 20x1 15,200 9,600
Accounts receivable, January 1, 20x1 44,000 34,800
Shipment from Home Office 48,800 37,600
Accounts receivable, December 31, 20x1 56,000 ?
Cash collections 68,000 56,000
Sales 80,000 64,000
Cash expenses 16,800 11,440
All sales, collections, and expenses are handled at the branch. All cash received from sales
and collections are sent directly to the home office. Expenses are paid by the branch from
the imprest fund and immediately reimbursed by the home office and credited to the Home
Office account. All expenses paid by the branch are recorded by the branch.
Calculate the balance of the Home Office account (1) on January 1, 20x1 in the books of
Silay Branch and (2) on December 31, 20x1 in the books of Talisay Branch
A. B. C. D.
Silay Branch (1) P51,200 (1) P60,000 (1) P62,400 (1) P62,400
Talisay Branch (2) P62,400 (2) P51,200 (2) P51,200 (2) P53,600

Reconstruction of Accounts
48. The following information concerning PRIA’s branch in Laguna were gathered after
the branch's first year of operation. Laguna branch acquires all of its inventories
from the home office and twenty-five percent of the shipments from the home office
remained unsold.
per Branch books per Home office books
Branch sales P950,000 -
Branch cost of goods sold 425,700 -
Branch expenses 424,300 -
Branch net income 100,000 332,200
How much was the cost of the merchandised shipped to the laguna branch?
A. P567,600 C. P309,600
B. P258,000 D. P232,200
Reconciliation of Reciprocal Accounts

49. At December 31, 20x1, the following information has been collected by FCP Company’s office
and branch for reconciling the branch and home office accounts.
1. The home office’s branch account balance at December 31, 20x1 is P590,000.
2. On December 30, 20x1, the branch sent a check for P40,000 to the home office to settle
its account. The check was not delivered to the home office until January 3, 20x2.
3. On December 27, 20x1 the branch returned P15,000 of seasonal merchandise to the
home office for the January clearance sale. The merchandise was not received by the
home office until January 6.
4. The home office allocated general expenses of P28,000 to the branch. The branch had
not entered the allocation at the year-end.
5. Branch store insurance premiums of P900 were paid by the home office. The branch
recorded the amount of P600.
The unadjusted balance of the home office account in the books of the branch at December
31, 20x1 is:
a. P 506,100 c. P506,700
b. P 535,000 d. P507,000
50. PRIA Company operates a branch in Bacolod City. At the end of the year, the branch account
in the books of the home office at Makati shows a balance of P600,000. The following
information is ascertained:
A. The branch made a profit of P40,400 for the month of December but the home office
erroneously recorded is as P44720.
B. The branch has not received the cash in the amount of P100,000 sent by home office on
December 31. This was charged to General Expense account by the home office.
C. The home office has billed the branch the amount of P150,000 for merchandise, which
was in transit on December 31.
AFAR03003
D. Supplies of P18,000 was returned by the branch to the home office but the home office
has not yet reflected in its records the receipt of the supplies.
E. A home office accounts receivable for P42,000 was collected by the branch. Said
collection was not reported to the home office by the branch.
What is the unadjusted balance of the Home Office account of Bacolod branch?
A. 385,680 C. 469,680
B. 427,680 D. 569,680
51. The following transactions pertain to a branch's first month's operations:
A. The home office sent P9,000 cash to the branch.
B. The home office shipped inventory costing P40,000 to the branch; the intercompany
billing was for P50,000.
C. Branch inventory purchases from outside vendors totaled P30,000.
D. Branch sales on account were P80,000.
E. The home office allocated P2,000 in advertising expense to the branch.
F. Branch collections on accounts receivable were P45,000.
G. Branch operating expenses of P14,000 were incurred, none of which were paid at month-
end.
H. The branch remitted P17,000 to the home office.
I. The branch's ending inventory (as reported in its balance sheet) is composed of:
Acquired from outside vendors P 12,000
Acquired from home office (at billing price) 20,000
Total 32,000
What is the balance of the Home Office Current account in the books of the branch based
from all transactions above?
A. P 16,000 C. P 50,000
B. P 44,000 D. P 60,000
52. PRIA ENTERPRISES operates a number of branches nationwide. The Home Office is currently
performing a reconciliation between the PRTC Branch Account In the books of the Home
Office and the Home Office account in the books of PRTC Branch. The branch account in the
Home Office books has an unadjusted credit balance of P49,600 at December 31, 2014. The
following information will be relevant:
• Collection of branch account receivable by the Home Office, P800. The branch has not
been notified.
• Merchandise shipment in transit to branch, P3,200.
• Acquisition of branch furniture by branch, PI,200, in the late afternoon of December
31, 2014. It is Home Office policy to account for all company fixed assets in the Home
Office books
• A return of excess merchandise by the branch, PI,500 but not recorded yet by Home
Office.
• Cash remittance in transit by the branch, P500.

Calculate the balance of the Home Office account in the books of PRTC Branch, before
adjustment, at December 31, 2014.
A. P44,000 C. P 47,200
B. P46,400 D. P 47,400
COMPREHENSIVE PROBLEM
PRIA Company has a branch in Cavite and Laguna. The reciprocal accounts between the
home office and the branches were in agreement at the beginning of 2015. However at
December 31, 2015, there is a discrepancy between the reciprocal accounts. The home
office account in Cavite's books has an unadjusted balance of P822,000. Investment in
Laguna account has a balance of P420,000 as of December 31,
On December 21, Cavite branch remitted P71,500 cash to the home office, PRIA Company
failed to record the said remittance. Laguna branch returned goods costing P54,800 to the
home office. The goods were shipped on December 19 and received on December 24 but
no entries have been made in the home office books.
On December 29, the home office has instructed Cavite branch to transfer P74,000 cash
to Laguna branch. Cavite recorded this transaction immediately. Upon receipt, Laguna
has recorded this transfer at P47,000. The home office however has not yet recorded this
inter-branch transaction as of the end of the year.
Cavite has collected cash of P34,500 from Laguna's customer on account. Laguna and
the home office have failed to record this transaction.
PRIA has transferred goods costing P86,700 to Cavite branch and paid P7,500 of shipping
cost on December 16. Cavite branch shipped all of these goods to Laguna branch upon
instruction of the home office on December 30. Shipping cost is P7,200 freight collect. Had
the goods were shipped directly to the Laguna branch , P10,000 of freight cost would have
been incurred. The branches and the home office did not record the inter-branch
shipment.
53. What is the unadjusted balance of Investment in Cavite account?

A. P933,000 C. P1,002,000
B. P522,600 D. P785,000
54. What is the unadjusted balance of Home Office Current account in Laguna's books?
A. P404,700 C. P412,200
B. P439,200 D. P473,700
***end of Lecture Problems***
AFAR03003 Do-it-Yourself
D O - I T - Y O U R S E L F
1. Solo Company filed a voluntary bankruptcy petition on June 25, 2017, and the statement of
Book Value Appraised Value
Assets:
Free assets 210,000 160,000
Liabilities:
Assume that the assets are converted into cash at appraised values, and the business is
liquidated. How much cash will be available to pay unsecured nonpriority claims?
a. P240,000 b. P180,000 c. P160,000 d. P125,000
2. Par Company has been forced into bankruptcy and liquidity. Unsecured claims will be paid at
the rate of P0.50 on the peso. Mace Company holds a noninterest-bearing note receivable
from Par in the amount of P50,000, collateralized by machinery with a liquidation value of
P10,000. The total amount to be realized by Mace on this note receivable is
a. P35,000 b. P30,000 c. P25,000 d. P10,000
3. Dome Company filed a voluntary bankruptcy petition on July 15, 2017, and the statement of
Book Value Appraised Value
Assets:
Free assets 200,000 140,000
Liabilities:
Assume that the assets are converted into cash at appraised values, and the business is
liquidated. What amount of cash should the partially secured creditors receive?
a. P60,000 b. P84,000 c. P90,000 d. P100,000

Do-it-yourself
4. Link Inc. is undergoing liquidation since January 1, 2017. Its condenced statement of
realization and liquidation as of April 30, 2017 show: Assets to be realized P1,375,000; Assets
acquired P750,000; Assets realized P1,200,000; Assets not realized P1,375,000; Liabilities
liquidated P1,875,000; Liabilities not liquidated P1,700,000; Liabilities to be liquidated
P2,250,000; Liabilities assumed P1,625,000; Supplementary charges P3,125,000;
Supplementary credits P2,800,000. The net income (loss) for the four-month period ending
April 30, 2017 is
a. (P325,000) b. P425,000 c. P750,000 d. P250,000
5. Mercy, Inc. is insolvent and its statement of affairs show: Estimated gain on realization of
assets P1,440,000; Estimated losses on realization of assets P2,000,000; Additional assets
P1,280,000; Additional liabilities P960,000; Capital stock P12,000,000; Deficit P11,200,000.
The pro-rata payment to stockholders on the peso is
a. P0.70 b. P0.43 c. P0.30 d. P0.57
6. The statement of realization and liquidation of Bankrupt company shows the following:
Assets to be realized P55,000; Assets acquired P30,000; Assets realized P48,000; Assets not
realized P55,000; Liabilities to be liquidated P90,000; Liabilities assumed P65,000; Liabilities
liquidated P75,000; Liabilities not liquidated P68,000; Supplementary charges P125,000;
Supplementary credits P112,000. The increase (decrease) in retained earnings is
a. (P13,000) b. P17,000 c. P30,000 d. P13,000
7. The following were taken from the statement of affairs of Nodebt Company: Assets pledged
with fully secured creditors P71,000; Assets pledged with partially secured creditors P12,500;
Free assets P11,000; Preferred creditors P3,000; Fully secured creditors P69,000; Partially
secured creditors P20,000; Unsecured creditors without priority P18,000. The amount of
unsecured liabilities is
a. P18,000 b. P25,500 c. P28,500 d. P38,000
8. Refer to No. 7. The estimated deficiency to unsecured creditors is
a. P5,000 b. P12,500 c. P15,500 d. P14,500
9. The statement of realization and liquidation was prepared for Hopeless Corporation for the
three-month period December 31, 2017. The totals are as follows:
Assets to be realized P 55,000
Liabilities assumed P 30,000
The net income (loss) for the period must be
a. P7,000 b. (P35,000) c. (P28,000) d. (P42,000)
10. A statement of realization and liquidation has been prepared for the Nomoney Corporation.
The totals are as follows:
Assets to be realized P 60,000
Liabilities assumed P 50,000
Retained earnings decreased by P12,000. The ending balances of capital stock and retained
earnings are P100,000 and (P85,000), respectively. How much was the beginning balance of
cash?
a. P47,000 b. P35,000 c. P20,000 d. not given
11. The following were found in your examination of the interplant accounts between the
Bulacan Home Office and its Laguna Branch.
a. Transfer of fixed assets from Home Office amounting to P67,450 was not booked by the
branch.
b. P12,500 covering marketing expense of another branch was charged by Home Office to
Laguna.
c. Laguna recorded a debit note on inventory transfers from Home Office of P93,750 twice.
d. Home Office recorded cash transfer of P82,125 from Laguna Branch as coming from
Tagum City Branch.
e. Laguna reversed a previous debit memo from Cagayan de Oro Branch amounting to
P13,125. Home Office decided that this charge is appropriately Tagum City Branch's cost.
f. Laguna recorded a debit memo from Home Office of P5,812.50 as P5,700.
The net adjustment in the Home Office books related to the Laguna Branch Current account
is
a. P 94,625 c. P 107,750
b. P 82,125 d. P 118,525
12. The San Miguel Branch of Taiwan Products, Inc. buys merchandise from outsiders and receive
merchandise from the home office for which it is billed at 20% above cost. Below are excerpts
from the trial balances and data on the home office and San Miguel Branch for the month of
April, 2015:
HOME OFFICE:
Cr. Allowance for overvaluation of branch merchandise 462,500
Cr. Shipment to Branch 1,062,500

Do-it-yourself
BRANCH:
Dr. Beginning inventory 1,800,000
Shipments from home office 1,275,000
Purchases 512,500
Month-end additional data:
Ending inventory of branch 1,825,000
From Home Office, billed price of 1,462,500
From outsiders, at cost 362,500
The total cost of goods sold of the San Miguel Branch at cost (net of overvaluation) for the
month just ended amounted to:
a. P1,762,500 c. P1,543,750
b. P1,731,250 d. P2,312,500
13. The following information are taken from the books and records of Cebu City Company and
its branch. The balances are at December 31, 2015, the second year of the company's
operations.
Books Books
Sales P500,000
Expenses 125,000
Shipment to Branch P250.000
Branch inventory allowance 71,875
The branch obtains all its merchandise from the home office. The home office ships the
merchandise at 125% of its cost. The ending inventory of the branch is P50,000 at the billed
price.
The true income of the branch is:

a. P 68,281.25 c. P127,500
b. P140,000 d. P 52,500
14. Presented below are items taken from the unadjusted trial balances of NCR Company and its
Manila Branch on December 31, 2015:
Home Office Branch
Books Books
Shipment to branch P2,250,000
AFOVOBI 749,250
Shipment from HO P2,925,000
Purchases (from OV) 1,084,500
MI, January 1 921,375
MI, December 31 365,625
Sales 4,800,000
Expenses 382,500
Assuming that the branch ending inventory acquired from other vendors (OV) is P73,125
What is the net income (loss) of the branch insofar as the home office is concerned?
a. 534,000 c. P315,000
b. P681,750 d. (P147,750)
15. Teardrops Commercial Corp. maintains a branch in Iloilo City. Selected balances taken from
the books of Teardrops and its Bacolod City branch as of December 31, 2015 are as follows:
Home Office Branch
Office
Merchandise Inventory, Jan 1 P12,000 P 8,000
Purchases 150,000 30,000
Branch Inventory Allowance 19,750
Sales 115,000 176,500
Merchandise Inventory, Dec 31 14,000 10,350
P4,350 of the branch's ending inventory came from purchases from suppliers other than the
home office.
As far as the home office is concerned, the cost of sales of the branch was:
a. P97,120 c. P121,400
b. P102,850 d. P131,850
16. During the year 2015 the Bacolod Corporation bills its Iloilo branch at 140% of cost. Goods
billed at P346,500 were shipped to the branch. The account Allowance for overvaluation has
a balance of P122,400 before adjustment. The beginning inventory of the branch from the
home office at cost is P93,600; the beginning inventory of the branch from outsiders is
P15,200, purchases from outsiders is P130,500.
Cost of goods available for sale of the Iloilo Branch in 2015 is

a. P486,800 c. P609,200
b. P623,240 d. P463,500
17. The PRIA Company bills its UC branch tor merchandise at 135% of cost. On December 31 the
following information were reported by the branch:
Merchandise
Merchandise Purchased
from Home from
Office (at Outsiders (at
Billed priced) cost)
Merchandise inventory, December 1 P16,200 P 4,000
Merchandise into stock, December 1-31 20,250 12,000
Merchandise inventory, December 31 18,900 5,000

Do-it-yourself
Assuming that the branch has a net income of P20,000 and had returned to the home office
merchandise originally acquired at a billed price of P540. The true branch profit as far as the
USJR Company is concerned is:
a. P24,690 c. P20,000
b. P24,130 d. P24,410
18. A reconciliation of the Inv. In Branch account in the head office of PRTC Company and the
Home Office account carried on the books of its CDO branch showed the following
discrepancies at December 31, 2015.
a) Collection of branch account receivable by the home office, P800. The branch was
not notified.
b) Shipment in transit to branch on December 31, 2015, P3,200.
c) Acquisition of furniture by the branch, P1, 200. The furniture account is to be
maintained on the home office books. The home office had not been notified of
the acquisition.
d) Return of excess merchandise by the branch but not received yet by the home office,
PI,500.
e) Cash remittance by the branch on December 31, 2015, P500. This was still in transit.
The Home Office account on the branch books has a credit balance of P44,000 at
December 31, 2015.
COMPUTE: (1) the unadjusted balance of the Inv. In Branch account on the home office books
at December 31, 2013; (2) the adjusted balance of the reciprocal accounts on December 31,
2015.
a. (1)P49,600; (2) P47,200 c. (1) 47,400; (2) P40,000
b. (1)P49,600; (2) P46,400 d. (1) 50,100; (2) P46,000
19. GHI Company bills its Bulacan Branch for merchandise shipments at 125% of cost. As of cut-
off date, December 31, 2015, the following data were available:
Mdse. Fr Mdse.
Home Purchased
Office(at from
billed prices) Outsiders Total
Merchandise, December 1 P300,000 P120,000 P420,000
Additions to stock during
December 450,000 360,000 810,000
Merchandise, December 31. 420,000 150,000 570,000
The branch returned P15,000 worth of merchandise to the Home Office acquired at billed
price.
The amount of the allowance for overvaluation account that was realized as income in view
of branch sales for the month of December was:
a. P63,000 c. P87,500
b. P66,000 d. P84,000
20. The Batangas Corporation operates a branch in Lipa City, flic Home Office ships merchandise
to the branch at 125% of its cost. Selected information from the December 31, 2015 trial
balance are as follows:
Books Books
Sales P600,000 P300,000
Shipments to branch 200,000
Purchases 350,000
Allowance for Overvaluation of branch Inventory 58,000
Expenses 120,000 50,000
Inventory at December 31, 2015:
Home Office P30,000
Branch Office 60,000
The combined net income of the home office and the branch after adjustment is:
a. P326,000 c. P500,000
b. P496,000 d. P280,000
21. Profit and loss data for Cotabato Sales Company and its General Santos Branch for 2015
follows:
H.O. Branch
Sales P1,060,000 P315,000
Inventory, January 1 (at cost) 115,000
Inventory, January 1:
Acquired from Home Office (billed price) --- 50,000
Acquired from Outsiders (at cost) --- 35,000
Purchases 820,000 120,000
Shipments to Branch (at cost) 110,000
Shipments from Home Office (at billed price) 132,000
Inventory, December 31 (at cost) 142,000
Inventory, December 31:
Acquired from Home Office (billed price) 66,000
Acquired from Outsiders ( at cost) 70,000
Operating Expenses 200,000 100,000
Records show that the General Santos Branch was billed for merchandise shipment as
follows:
In 2014, cost + 25%;
In 2015, cost + 20%.

Do-it-yourself
The combined net income of the home office and the branch for the year ended December
31, 2015 is:
a. 212,000 c. 247,000
b. 225,000 d. 269,000
DIY – Answer key: B, B, B, B, A, B, B, B, D, A, A, C, C, A, B, C, D, B, A, A, A
NOTES
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PRIA AFAR03003 Corporate Liquidation and Home Office and Branch Accounting No Answer

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PRIA AFAR03003 Corporate Liquidation and Home Office and Branch Accounting No Answer

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PHILIPPINE REVIEW INSTITUTE FOR

ADVANCED FINANCIAL ACCOUNTING AND REPORTING

BATCH 3 – May 2019 AFAR03003

Batch 3 – May 2019 Page 2

Classification of liabilities: Accounting for Branch

Batch 3 – May 2019 Page 2

The transfer of inventory may be at cost or

Partially Secured Liability

Batch 3 – May 2019 Page 4

Unsecured, Non-Priority Claims

ASSETS LIABILITIES and SHAREHOLDERS' EQUITY

Batch 3 – May 2019 Page 6

11. How much is the estimated loss on asset realization?

12. How much is the estimated recovery percentage?

14. How much is the estimated recovery percentage?

15. How much is the estimated deficiency?

16. How much is the payment to unsecured creditors without priority?

Batch 3 – May 2019 Page 8

22. How much is the estate equity at July 31, 2015?

What is the total comprehensive income of the agency for 20x1?

Shipments to Branch at Billed Price

Shipments at Billed Price & Purchase from Outsiders

Batch 3 – May 2019 Page 14

An analysis of the beginning inventories provided the following:

Additional information at the month end

Billed Price NOT Given

Batch 3 – May 2019 Page 16

Combined Net Income

Home Office with Multiple Branch

SILAY BRANCH TALISAY BRANCH

Batch 3 – May 2019 Page 18

Reconciliation of Reciprocal Accounts

Batch 3 – May 2019 Page 20

53. What is the unadjusted balance of Investment in Cavite account?

***end of Lecture Problems***

Batch 3 – May 2019 Page 22

Batch 3 – May 2019 Page 24

The true income of the branch is:

Cost of goods available for sale of the Iloilo Branch in 2015 is

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DIY – Answer key: B, B, B, B, A, B, B, B, D, A, A, C, C, A, B, C, D, B, A, A, A

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Anda mungkin juga menyukai

end of Lecture Problems