BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Accounts of fixed assets. Usually, accounts relating to fixed assets used by the branch are kept in the head office books even if the asset is originally paid for by the branch. If it is so, the entry on purchase of a fixed asset by a branch will be to debit Head Office and credit Cash.

Detailed explanation-2: -In the books of the Head Office, Branch Account is debited with the goods supplied and all expenses met by Head Office and credited with all remittances and returns, similar to Customers Account. Therefore, the system can be called Debtors System or One Account System.

Detailed explanation-3: -The Head Office Current Account is thus a Proprietorship Account (i.e. Capital Account). In-spite of the independent status, the Branch cannot function without resources, and the resources, specially at the initial stage, are provided by the Head Office.

Detailed explanation-4: -Goods supplied to Dependent Branches by the Head Office may be either at Cost or at Invoice price. 3. The One Account System or Debtors System is generally adopted when the branch is fairly small in size.

Detailed explanation-5: -Features of Dependent Branch: Only those goods supplied by the Head office will be dealt (sold) by branch. Goods may be supplied to Head office at Cost price/Invoice price. Cash sales and collection from debtors are periodically remitted to the Head office. Branch expenses like salary, rent, etc.