A & B Ltd's head office is in Accra, and it has a branch at Tema....

 

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A & B Ltd's head office is in Accra, and it has a branch at Tema. The following trial balances have been extracted from the respective books of account of both the head office and the branch as at 30th June 2008. Administrative expenses Branch current account Stated ordinary share capital Debtors and Creditors Cash at bank and in hand Distribution cost Goods sent to branch Head office current account Plant and machinery (net book value) Profit and loss account (at 1/7/07) Provision for unrealized profit on stock held by branch Purchases and sales Good from Head office Stock at cost or cost to branch (at 1 July 2007) Debit C 135,000 46,000 Head office at cost Branch at cost to branch 15,000 19,000 30,000 383,000 Credit Additional information: Stock at 30 June 2008 was valued as follows: 300,000 22,500 20,000 166,000 28,000 1,500 225,000 350,000 Debit 9,000 2,000 12,000 38,000 154,000 Credit C 20,000 24,000 12,000 5,000 24,000 15,000 9,000 868,000 868,000 244,000 244,000 215,000 Goods in transit to branch at cost to branch Goods purchased by the head office and sold to the branch are transferred at cost plus 20%. At 30 June 2008 the branch had transferred 10,000 to the head office's bank account but as at that date, no record had been made in the head office's books of account Required: Prepare in adjacent columns the following: a) The head office, the branch, and the income statement for the year to 30 June 2008; and b) The head office, the branch, and the combined statement of financial position as at that date. A & B Ltd's head office is in Accra, and it has a branch at Tema. The following trial balances have been extracted from the respective books of account of both the head office and the branch as at 30th June 2008. Administrative expenses Branch current account Stated ordinary share capital Debtors and Creditors Cash at bank and in hand Distribution cost Goods sent to branch Head office current account Plant and machinery (net book value) Profit and loss account (at 1/7/07) Provision for unrealized profit on stock held by branch Purchases and sales Good from Head office Stock at cost or cost to branch (at 1 July 2007) Debit C 135,000 46,000 Head office at cost Branch at cost to branch 15,000 19,000 30,000 383,000 Credit Additional information: Stock at 30 June 2008 was valued as follows: 300,000 22,500 20,000 166,000 28,000 1,500 225,000 350,000 Debit 9,000 2,000 12,000 38,000 154,000 Credit C 20,000 24,000 12,000 5,000 24,000 15,000 9,000 868,000 868,000 244,000 244,000 215,000 Goods in transit to branch at cost to branch Goods purchased by the head office and sold to the branch are transferred at cost plus 20%. At 30 June 2008 the branch had transferred 10,000 to the head office's bank account but as at that date, no record had been made in the head office's books of account Required: Prepare in adjacent columns the following: a) The head office, the branch, and the income statement for the year to 30 June 2008; and b) The head office, the branch, and the combined statement of financial position as at that date.