WAEC Accounting 2022 Theory — Question 11

Question 11 of 17 from the West African Examinations Council (WAEC) Accounting 2022 Theory paper, with the correct answer and a full explanation.

4(b) Explain two methods of accounting for goods sent to branch.

Model answer

- Cost price method: goods sent to the branch are recorded at cost price. - Selling price (cost plus fixed percentage) method: goods sent to the branch are invoiced at a fixed mark-up (selling price), so profit is added at the point of transfer.

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