Advanced Accounting Part 2
Chapter 13
Problem 5
Worksheet
Account Titles
Cash
Accounts receivable
Merchandise Inventory - December 1
Furniture and Fixtures
Store supplies
Prepaid expense
Branch
Purchases
Shipment from Home Office
Advertising expense
Salaries and commission expense
Miscellaneous selling expense
Rent expense
Miscellaneous general expense
Merchandse Inventory - December 31
Total Debits
Accumulated Depreciation - Furniture and fixtures
Shipment to branch
Unrealized intercompany inventory profit
Sales
Accrued expense
Accounst payable
Home office
Capital Stock
Retained earnings
Income and expense summary
Total Credits
Net income
Balance
Unadjusted Trail Balance
Home Office
10,350
26,200
31,500
8,500
940
33,760
27,600
2,850
4,250
1,850
2,700
2,600
153,100
2,500
8,500
3,700
44,850
35,400
65,000
(6,850)
153,100
1. Reconciliation of reciprocal accounts
Unadjusted balance
a. Remittance
b. Unrecorded expenses
Adjusted balances
Branch
33,760
(1,500)
32,260
2. Table
Billed
Inventory - Beginning
Shipment from home office
Goods available for sale
Inventory - Ending
Cost of goods sold
Adjusting Entries:
12,000
10,200
22,200
11,700
10,500
Cost
10,000
8,500
18,500
9,750
8,750
Home Office
Debit
24,200
a.)
Merchandise Inventory
Income and expense Summary
b.)
Miscellaneous selling expense
Store supplies
560
c.)
Prepaid expenses
Miscellaneous general expense
350
d.)
Miscellaneous general expense
Accrued expense
260
e.)
Miscellaneous general expense
Accumulated depreciation - F & F
f.)
Cash
1,500
Branch
g.)
85
Miscellaneous general expense
Home office
Closing Entries and Eliminating Entries
Closing Entries
Income and expense summary
Sales
Shipment to Branch
Merchandise inventory - December 1
Purchases
Shipment from Home Office
Advertising expense
Salaries and commission expense
Miscellaneous selling expense
Rent expense
Miscellaneous general expense
20,555
44,850
8,500
Home office
Income and expense summary
Branch income and expense summary
Branch
3,021
Unrealized intercompany inventory profit
Branch income and expense summary
1,750
Income and expense summary
Branch income and expense summary
1,271
Income and expense summary
Retained Earnings
2,374
Eliminating entries for Combined Financial Statements
Income statement
a.
Shipment to Branch
Unrealized intercompany inventory profit
Shipment from Home office
Inventory - beginning
Income and expense Summary
Merchandise Inventory
Balance Sheet
a.
Unrealized intercompany inventory profit
Merchandise Inventory
b.
Home Office
Branch
Home and Branch
Debit
8,500
3,700
1,950
1,950
29,239
djusted Trail Balance
Adjusting and Reconciling Entries
Adjusted trail balance
Branch
2,650 f
12,850
14,400
3,600
580 b
c
f
4,100
10,200
2,800
2,350
1,050 b
1,500
700 c
d
e
g
a
56,780
Home Office
1,500
540 e
85
36
260
105
(560)
350
(1,500)
560
(350)
260
85
24,200
24,545
Branch
(280)
120
280
(120)
105
36
220
14,600
14,961
20,000
d
4,200
32,040 g
a
56,780
Home Office
11,850
26,200
31,500
8,500
380
350
32,260
27,600
2,850
4,250
2,410
2,700
2,595
24,200
177,645
2,585
8,500
3,700
44,850
260
35,400
220
24,200
24,545
14,600
14,961
65,000
(6,850)
24,200
177,645
Home Office
32,040
220
32,260
Allowance
2,000
1,700
3,700
1,950
1,750
Home Office
Credit
Branch
Debit
14,600
24,200
Credit
14,600
280
560
280
120
350
120
105
260
105
36
85
36
1,500
220
220
17,621
20,000
31,500
27,600
14,400
4,100
10,200
2,800
2,350
1,330
1,500
941
2,850
4,250
2,410
2,700
2,595
3,021
3,021
3,021
1,750
1,271
2,374
Home and Branch
Credit
10,200
2,000
1,950
1,950
29,239
Individual Financial Stateme
justed trail balance
Branch
2,650
12,850
14,400
3,600
300
120
Income Statement
Home Office
Branch
31,500
14,400 a
4,100
10,200
2,800
2,350
1,330
1,500
27,600
4,100
10,200
2,800
2,350
1,330
1,500
941
14,600
71,741
2,595
2,850
4,250
2,410
2,700
73,905
a
a
a
a
a
a
941 a
37,621
576
8,500
20,000
105
4,200
32,260
44,850
14,600
71,741
24,200
77,550
3,645
73,905
a
d
20,000 a
14,600
34,600
(3,021)
37,621
Branch Income Statement
Sales
Less: Cost of Sales
Merchandise inventory -beg
Shipment from Home Office
Purchases
Goods available for sale
Less: Merchandise inventory - end
Gross profit
Less: Expenses
Advertising expense
Salaries and commission expense
Miscellaneous selling expense
Rent expense
Miscellaneous general expense
Net loss
Add: Realized profit
Branch true net loss
Home Office Income Statement
Sales
Less: Cost of Sales
Merchandise inventory -beg
Purchases
Goods available for sale
Less: Shipment to branch
Merchandise inventory - en
Gross profit
Less: Expenses
Advertising expense
Salaries and commission expense
Miscellaneous selling expense
Rent expense
Miscellaneous general expense
Net income from own operation
Less: Branch true net loss
Net income
Branch Balance sheet
Cash
Accounts receivable
Merchandise Inventory
Store supplies
Prepaid expense
Furniture and fixtures
Less: Accumulated depreciation
Total Assets
Accrued expense
Accounts payable
Home office
Total Liabilities
Home Office Balance sheet
Cash
Accounts receivable
Merchandise Inventory
Store supplies
Prepaid expense
Branch
Less: Unrealized intercompany inventory profit
Furniture and fixtures
Less: Accumulated depreciation
Total Assets
Accrued expense
Accounts payable
Capital Stock
Retained earnings
Total Liabilities and Stockholders' Equity
Individual Financial Statement
Closing entries
(31,500)
(3,021)
(27,600)
Balance Sheet
Home Office
Branch
11,850
2,650
26,200
12,850
(14,400)
(2,850)
(4,250)
(2,410)
(2,700)
(4,100)
(10,200)
(2,800)
(2,350)
(1,330)
(1,500)
(2,595)
(941)
(76,926)
(8,500)
(1,750)
(44,850)
(37,621)
8,500
380
350
29,239
3,600
300
120
-
24,200
100,719
14,600
34,120
2,585
576
1,950
(20,000)
260
35,400
(3,021)
2,374
(24,200)
(76,926)
105
4,200
29,239
65,000
(4,476)
(14,600)
(37,621)
100,719
34,120
20,000
14,400
10,200
4,100
28,700
14,600
2,800
2,350
1,330
1,500
941
14,100
5,900
8,921
(3,021)
1,750
(1,271)
44,850
31,500
27,600
59,100
8,500
24,200
32,700
2,850
4,250
2,410
2,700
2,595
26,400
18,450
14,805
3,645
1,271
2,374
2,650
12,850
14,600
300
120
3,600
576
3,024
33,544
105
4,200
29,239
33,544
11,850
26,200
24,200
380
350
29,239
1,950
8,500
2,585
27,289
5,915
96,184
260
35,400
65,000
(4,476)
96,184
Combined Financial Statement
Eliminating
Entries
Income
Statement
Eliminating
Entries
Balance Sheet
14,500
39,050
(2,000)
43,900
(29,239)
12,100
680
470
-
31,700
5,650
6,600
3,740
4,200
3,536
(1,950)
99,326
36,850
103,650
3,161
(8,500)
(1,950)
64,850
(29,239)
(1,950)
36,850
101,700
2,374
99,326
365
39,600
65,000
(4,476)
103,650
Combined income statement
Sales
Less: Cost of Sales
Merchandise inventory -beg
Purchases
Goods available for sale
Less: Merchandise inventory - end
Gross profit
Less: Expenses
Advertising expense
Salaries and commission expense
Miscellaneous selling expense
Rent expense
Miscellaneous general expense
Combined Net income
64,850
43,900
31,700
75,600
36,850
5,650
6,600
3,740
4,200
3,536
38,750
26,100
23,726
2,374
Combined Balance sheet
Cash
Accounts receivable
Merchandise Inventory
Store supplies
Prepaid expense
Furniture and fixtures
Less: Accumulated depreciation
Total Assets
Accrued expense
Accounts payable
Capital Stock
Retained earnings
Total Liabilities and Stockholders' Equity
14,500
39,050
36,850
680
470
12,100
3,161
8,939
100,489
365
39,600
65,000
(4,476)
100,489
