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MULTIPLE CHOICE QUESTIONS
1. HO at Mumbai keeps a single ‘Pune Branch Account’ which is used to
record all items relating to the branch.
(a)Pune branch is dependent branch whose accounts are kept under the
‘Debtors’ method
(b)Pune branch is an independent branch whose accounts are kept under
the ‘Debtors’ method
(c)Pune branch is a dependent branch whose accounts are kept under
the ‘Stock and Debtors’ method
(d)Mumbai branch is a dependent branch whose accounts are kept under
the ‘Stock and Debtors’ method
2. When the Head Office sends the goods at cost to a dependent branch,
the Head Office opens the following accounts for that branch in its books
under the Debtors method
(a)(i) Branch Account (ii) Goods sent to Branch Account
(b)(i) Branch Account (ii) Goods sent to Branch Account (iii) Branch Stock
Account
(c)(i) Branch Account (ii) Goods sent to Branch Account (iii) Branch
Debtors Account
(d)(i) Branch Account (ii) Goods sent to Branch Account (iii) Stock
Reserve Account
3. The HO sends goods to its branch at a loading of 20% on cost.
th
(a)The loading is 1/6 of sales
(b)The loading is 25% of sales
rd
(c)The loading is 1/3 of sales
(d)The loading is 1/9th of sales
4. The HO sends its goods to its branch at a loading of 25% on sales.
rd
(a)The loading is 1/3 of cost
(b)The loading is 50% of cost
th
(c)The loading is 1/4 of cost
(d)The loading is 20% of cost
5. The following entry is passed for a dependent branch at Pune following
the ‘Debtors’ method-
Goods sent to Pune Branch a/c Dr.
To Pune Branch a/c
This entry may indicate
(a)Goods returned to HO by the Pune branch
(b)Goods returned to HO directly by the Pune branch customers
(c)Goods sent by Pune branch to another branch
(d)Goods sent by Mumbai branch Account
6. The following entry is passed for a dependent branch at Pune following
the ‘Debtors’ method-
Pune Branch a/c Dr.
To Goods sent to Pune Branch a/c
This entry may indicate
(a)Goods sent to Pune Branch by HO
(b)Goods sent to Pune branch by another branch
(c)Goods sent to Mumbai Branch by HO
(d)Goods sent to Andhra Pradesh by HO
7. The following entry is passed for a dependent branch at Pune following
the ‘Debtors’ method-
Pune Branch a/c
To Cash/Bank a/c
This entry any indicate
(a)Cash sent to Pune Branch by HO
(b)Cash received from Pune Branch by HO
(c)Expenses of HO paid by Pune Branch
(d)Income received to HO
8. Under the ‘Debtors’ method, closing balance in the Branch Account
indicates
(a)Profit or loss at the branch
(b)Amount due from the branch
(c)Closing stock at the branch
(d)Opening stock at Branch
9. Under the ‘Debtors’ method, closing balance in the Goods sent to Branch
Account
(a)Is transferred to Purchases/Trading Account
(b)Indicates the closing stock at branch
(c)Indicates gross profit/loss at the branch
(d)Indicates the amount due from the branch debtors
10. Under the ‘Debtors’ method, Goods returned by debtors to branch
(a)Will not be recorded by the HO in the Branch A/c
(b)Will be debited to Goods sent to branch a/c and credited to the Branch
a/c
(c)Will be debited to Goods sent to branch a/c and credited to the Branch
Debtors a/c
(d)Will be debited to Branch Stock a/c and credited to the Branch Debtors
a/c
11. Under the ‘Debtors’ method, depreciation on fixed assets at the
branch
(a)Will be recorded by the branch in its Memorandum Accounts
(b)Will be debited to Depreciation a/c and credited to the Branch a/c
(c)Will be debited to HO a/c and credited to the Branch Fixed assets a/c
(d)Will be debited to Branch a/c and credited to the HO a/c
12. When the Head Office sends the goods at invoice price to a
dependent branch, the Head Office opens the following accounts for that
branch in its books under the Debtors method:
(a)(i) Branch account (ii) Goods sent to Branch Account (iii) Stock
Reserve Account
(b)(i) Branch account (ii) Goods sent to Branch Account (iii) Branch Stock
Account
(c)(i) Branch account (ii) Goods sent to Branch Account (iii) Branch
Debtors Account
(d)(i) Branch account (ii) Goods sent to Branch Account
13. When the Head Office sends the goods at invoice price to a
dependent branch, the loading of goods sent by HO to branch is adjusted
by passing the following entry
(a)Goods sent to branch a/c Dr.
To Branch A/c
(b)Branch A/c Dr.
Stock Reserve A/c Dr.
(c)To Stock Reserve A/c
To Branch A/c
(d)Bank A/c Dr.
To Branch A/c
14. When the Head Office sends the goods at invoice price to a
dependent branch, the loading on closing stock at branch is adjusted by
passing the following entry
(a)Branch A/c Dr.
To Stock Reserve A/c
(b)Goods sent to branch a/c Dr.
To Branch A/c
(c)Stock Reserve A/c Dr.
To Branch A/c
(d)Stock Reserve A/c Dr.
To Bank A/c
15. Head Office sends the goods at invoice price to a dependent
branch. The total of (i) Cash remitted to H.O. + (ii) Cash balance with
Branch + (iii) Closing stock with Branch (at invoice price) is more than
the total (at invoice price) of (i) Opening stock with Branch + (ii) Goods
sent to Branch. This indicates
(a)Profit for the year earned by the branch
(b)Cash and stock on the last day of the year with the branch
(c)Likely fraud/ error involving cash and/or stock
(d)Loss for the year earned by the branch
16. Under Stock and Debtors method, Branch Stock Account helps to
(a)Ascertain gross profit/loss of branch
(b)Ascertain net profit/loss of branch
(c)Ascertain closing stock at the branch
(d)Ascertain cost of goods sent to the branch
17. Branch Adjustment Account is opened
(a)Under Stock and Debtors method, when goods are sent by HO to
branch at invoice price
(b)Under Debtors method, when goods are sent by HO to branch at cost
(c)Under Stock and Debtors method, when goods are sent by HO to
branch at cost
(d)Under Debtors method, when goods are sent by HO to branch at
invoice price
18. Branch account under debtors system is a
(a)Nominal account
(b)Real account
(c)Personal account
(d)Representative personal account
19. Branch account under stock and debtors system is a
(a)Real account
(b)Nominal account
(c)Personal account
(d)Representative personal account
20. When Branch ‘A’ sends goods to Branch ‘B’ in the books of Branch
‘A’ debit is given to
(a)Head office account
(b)Branch ‘B’ account
(c)Sales return account
(d)Purchase returns account
21. The cash and credit sale of a branch are ₹5,000 and ₹10,000
respectively. The amount collected from debtors is ₹10,000. Under
debtors system the amount credited to branch will be
(a)₹ 15,000
(b)₹ 20,000
(c)₹ 25,000
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