CA Inter P1 · Chapter 13 · Question 3 of 10
Case: At year end, the Branch Account in the head office books of Omkar Ltd shows a debit balance of ₹8,40,000, while the Head Office Account in the books of its independent branch shows a credit balance of ₹7,90,000. Cash of ₹35,000 remitted by the branch and goods of ₹15,000 sent by the head office are in transit. After accounting for the items in transit, the agreed balance of the inter-office accounts is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) ₹8,05,000
Explanation
From the head office side: 8,40,000 - cash in transit 35,000 = 8,05,000. From the branch side: 7,90,000 + goods in transit 15,000 = 8,05,000. Both equal ₹8,05,000, confirming the reconciliation.
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