BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Under the debtors system in branch a/c, credit sales are
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Debited to branch a/c
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Credited to branch a/c
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Debited to debtors a/c
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Credited to debtors a/c
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Explanation:
Detailed explanation-1: -The correct option Nominal Account. Debtor System of accounting is suitable for the small-size branches. Under this, a Branch Account is opened for each branch in the head office ledger. All transactions are recorded in this account.
Detailed explanation-2: -Branch Account under Debtors System is a Real Account. 8. Under Debtors System Branch Account is debited with losses like bad debts, discounts allowed and depreciation.
Detailed explanation-3: -Credit sales, Bad debts, Discount allowed, Returns from Debtors to branch are not direct transactions from the Head office and as such they are not recorded in the Branch Account.
There is 1 question to complete.