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JAMB Principles of Accounts 2001 Question 46

Question 46

Branch Accounts

The correct entry to reflect the receipt of cash sent by a branch to a head office is

  1. A.debit cash and credit branch current account
  2. B.debit branch current account and credit cash
  3. C.credit branch debtors and debit cash
  4. D.credit branch current account and debit branch debtors.
Show the answer and explanation

Answer: A (debit cash and credit branch current account)

Explanation

Head office receives cash (debit cash) and the branch owes less (credit branch current account).