System one-the head office maintains all the accounts, Financial Accounting

SYSTEM ONE-THE HEAD OFFICE MAINTAINS ALL THE ACCOUNTS

This system is suitable for an enterprise that has small branches (possibly in another area of the town or city where the Head Office –HO– is situated), which sell goods supplied by the HO. On the sale of goods, cash is received which should be banked intact into the local branch of a bank; the bank can be instructed to credit the Head Office account, which is maintained at a different branch of the same bank. Cash expenditure by a branch is normally funded by an imp rest provided by the HO, replenished at regular intervals by a cheque for the actual amount of expenditure incurred.  Where credit sales are permitted at a branch, each invoice raised at the branch will be made out in the triplicate; one copy is given to the customer as the invoice; the second copy is sent (as part of a batch of invoices) to the HO; the third is retained by the branch for reference. All goods should be purchased through a central buying department at the HO.  Goods are issued to branches on the basis of requisitions received from branch managers.  Of course it should be realized, that with the advent of computers the amount of paperwork may be substantially reduced and procedures not exactly as described.

The branch manager should be required to forward to HO at weekly, fortnightly or monthly intervals, returns giving particulars of goods received from and returned to HO, cash and credit sales, cash received from debtors, expenses, cash banked and stock and cash in hand at the end of the period. From these, the HO will maintain accounts for the branch in the HO books.

Posted Date: 12/12/2012 1:08:37 AM | Location : United States







Related Discussions:- System one-the head office maintains all the accounts, Assignment Help, Ask Question on System one-the head office maintains all the accounts, Get Answer, Expert's Help, System one-the head office maintains all the accounts Discussions

Write discussion on System one-the head office maintains all the accounts
Your posts are moderated
Related Questions
Basics of Sundry Matters Current accounts balances must always be equal and opposite. The head office current account in the branch books should always have a credit bal

Q. Show the Foreign Tax Credit? Foreign Tax Credit - A U.S. taxpayer who pays or accrues income tax to a foreign country may elect to credit or deduct these taxes in a determin

Fair value adjustment IFRS 3 requires that goodwill on consolidation should be based on the fair values of the net assets of the subsidiary company on the date of acquisition. T

Answer the following questions relating to Discounted Cash Flow (DCF) projections and valuations. (a)    Michael Hudson asks a rhetorical question (tongue in cheek): "What's not

APPLICABILITY OF THE OPERATING CYCLE IN VEGETABLE GROWING BUSINESS

What is the best way of doing reconciliations of control accounts like Purchases Ledger Control vs Purchases Ledger and Sales Ledger Control vs Sales Ledger

Q. Explain about Tax Ramifications? i) Exercise price effects capital gains of individual and effects compensation expense used by corporation for calculating company's compens


ABATEMENT OF LEGACIES (a) If the assets, after the payment of debts, necessary expenses and specific legacies, are not sufficient to pay all the general legacies in full, the l

Dawn's new car has a FMV of $20,000 and it weighs 3,000 pounds. The county also assessed a property tax on the car. The tax was 2% of its FMV and $10 per hundred weight. The car is