To account for expenses paid by head office on behalf of the branch, the branch should___________
A Debit profit and loss account and credit head office account
B Debit head office account and credit cash
C Credit cash and debit profit and loss account
D Credit profit and loss account and debit head office account
Answer is A
At the head office, expenses incurred on behalf of the branch will also be debited to the branch account. Also, in the branch books, there will be head office accounts.
