Accounting Records of Independent Branch

Independent Branch, like the Head Office, keeps all its records separately and independently on Double Entry System. Branch accounting is a bookkeeping system in which separate accounts are maintained for each branch or operating location of an organization. It has its own Bank Account. It records such items as inventory, accounts receivable, wages, equipment, expenses such as rent and insurance, and petty cash. Thus, the Branch keeps the frill system of accounting. So, independent branches are those branches that maintain separate books of accounts completely and their profit and loss statement and Balance sheets are maintained separately from their Head office.

Accounting Records of Independent Branch

(1) For goods supplied by head office to branch:

Branch book:

Goods supplied by head office A/C………Dr.

To Head office A/C

(Being receipt of goods)

Head office book:

Branch A/C…………..Dr.

To goods supplied to branch A/C

(Being goods sent to branch)

(2) For cash remitted by head office to branch:

Branch book:

Cash A/C…………..Dr.

To head office A/C

(Being cash received)

Head office book:

Branch A/C ……………..Dr.

To cash A/C

(Being cash sent to branch)

(3) For goods returned by branch:

Branch book:

Head office A/C…………Dr.

To goods supplied to head office A/C

(Being goods return to head office)

Head office book:

Goods supplied from branch A/C…………Dr.

To Branch A/C

(Being goods returned from branch)

(4) For cash remitted by the branch to head office:

Branch book:

Head office A/C………….Dr.

To cash

(Being cash sent to head office)

Head office book:

Cash A/C……………..Dr.

To Branch A/C

(Being cash received from branch)

(5) For assets purchased by the branch on behalf of head office:

Branch book:

Head office A/C ………………Dr.

To cash A/C

(Being purchase of assets)

Head office book:

Branch assets A/C………….Dr.

To branch A/C

(Being assets purchased by branch)

(6) For depreciation charged:

Branch book:

Depreciation A/C ……………Dr.

To Head office A/C

(Being depreciation on branch fixed assets)

Head Office book:

Branch A/C……………….Dr.

To branch assets A/C

(Being depreciation of branch fixed assets)

(7) For expenses incurred by head office

Branch book

Expenses A/C…………..Dr.

To head office A/C

(Being expenses incurred by head office)

Head office book:

Branch A/C………………….Dr.

To profit and loss A/C

(Being expenses incurred for the branch)