Jamila Traders has a head office in Nanyuki and an autonomous branch in Thika. The trial...

  

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Jamila Traders has a head office in Nanyuki and an autonomous branch in Thika. The trial balances of the head office and the branch as at 30 September 2014 were as follows: Buildings (at cost) Goods sent to branch Goods received from head office Accounts receivable Remittances from branch Remittances to head office Cash at bank Stock (at cost) Stock (at mark up) Sales Capital (1 October 2013) Bank overdraft Furniture and fittings Purchases Rent and rates. Salaries and wages Current accounts. General expenses Accounts payable Drawings Provision for unrealized profits Head office Sh. 3,500,000 764,700 397,800 2,595,000 779,500 13,626,600 395,400 851,700 8,931,555 1,887,750 783,375 Sh. 6,482,205 7,548,750 13,000,000 6,040,925 1,239,000 202,500 34,513,380 34,513,380 Thika Branch Sh. 6,387,330 535,800 7,620,000 289,250 1,552,500 230,500 197,250 487,500 1,258,950 Sh. 9,202,200 250,000 8,836,680 270,200 18,559,080 18,559,080 Additional information: 1. Depreciation on furniture and fittings is to be provided at the rate of 10% per annum using the reducing balance method. A bonus of 10% is payable to the staff at the head office and the branch. The bonus is based on net profits after charging these bonuses. 2. Goods sent to the branch in August 2014 and which had an invoice value of Sh.94,875 were stolen in transit. The insurance company agreed to meet the claim to the extent of only 85% of the cost of the goods. Goods were invoiced to the branch at 15% above cost. All sales were at a mark up of 33% % above the cost to head office. 5. No shortages of stock were reported at the head office or the branch. Required: 3. 4. (a) Prepare in columnar form for the head office, Thika branch and the combined business, the income statements for the year ended 30 September 2014. (12 marks) (b) The combined balance sheet as at 30 September 2014. marks) (8 Jamila Traders has a head office in Nanyuki and an autonomous branch in Thika. The trial balances of the head office and the branch as at 30 September 2014 were as follows: Buildings (at cost) Goods sent to branch Goods received from head office Accounts receivable Remittances from branch Remittances to head office Cash at bank Stock (at cost) Stock (at mark up) Sales Capital (1 October 2013) Bank overdraft Furniture and fittings Purchases Rent and rates. Salaries and wages Current accounts. General expenses Accounts payable Drawings Provision for unrealized profits Head office Sh. 3,500,000 764,700 397,800 2,595,000 779,500 13,626,600 395,400 851,700 8,931,555 1,887,750 783,375 Sh. 6,482,205 7,548,750 13,000,000 6,040,925 1,239,000 202,500 34,513,380 34,513,380 Thika Branch Sh. 6,387,330 535,800 7,620,000 289,250 1,552,500 230,500 197,250 487,500 1,258,950 Sh. 9,202,200 250,000 8,836,680 270,200 18,559,080 18,559,080 Additional information: 1. Depreciation on furniture and fittings is to be provided at the rate of 10% per annum using the reducing balance method. A bonus of 10% is payable to the staff at the head office and the branch. The bonus is based on net profits after charging these bonuses. 2. Goods sent to the branch in August 2014 and which had an invoice value of Sh.94,875 were stolen in transit. The insurance company agreed to meet the claim to the extent of only 85% of the cost of the goods. Goods were invoiced to the branch at 15% above cost. All sales were at a mark up of 33% % above the cost to head office. 5. No shortages of stock were reported at the head office or the branch. Required: 3. 4. (a) Prepare in columnar form for the head office, Thika branch and the combined business, the income statements for the year ended 30 September 2014. (12 marks) (b) The combined balance sheet as at 30 September 2014. marks) (8

Answer rating: 100% (QA)

Income statements for the year ended 30 September 2014 HEAD OFFICE Sh Revenue 6040925 Cost of sales ... View the full answer