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WAEC Financial Accounting 2015 Question 42

Question 42

Branch Accounts

Goods stolen at the branch is debited to

  1. A.Defalcations Account.
  2. B.Branch Stock Account.
  3. C.Branch Adjustment Account.
  4. D.Branch Debtors Account.
Show the answer and explanation

Answer: A (Defalcations Account.)

Explanation

Stolen branch goods are credited to branch stock and debited to a defalcations (goods lost) account, later written off to profit and loss.