The accounting entries when goods are sold on credit at the branch are debit
Answer Details
The accounting entries when goods are sold on credit at the branch are a debit to the Branch Debtors Account and a credit to the Head Office Current Account.
When goods are sold on credit at a branch, the branch becomes a debtor to the Head Office, and the amount owed by the branch is recorded in the Branch Debtors Account. The credit sale amount is not directly recorded in any account since it is not a cash transaction. Instead, it is recorded in the Sales Accounts at the Head Office level as a part of the overall sales revenue.
The Head Office Current Account is credited to reflect the increase in the amount owed to the Head Office by the branch. The Head Office Current Account records all transactions between the Head Office and its branches. The credit entry to the Head Office Current Account represents the increase in the amount owed to the Head Office by the branch and serves as a record of the transaction for the Head Office.
In summary, the accounting entries when goods are sold on credit at the branch are a debit to the Branch Debtors Account to record the amount owed by the branch and a credit to the Head Office Current Account to reflect the increase in the amount owed to the Head Office by the branch.