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SSC Financial and Cost Accounting P-1 QUESTION #9655
Question 1
Under the Stock and Debtors System, the Branch Adjustment Account is CREDITED with:
  • Branch expenses
  • Closing stock reserve (loading on closing stock)
  • Opening stock reserve (loading on opening stock)✔️
  • Branch stock shortages
Correct Answer Explanation
The Branch Adjustment Account is credited with: (1) loading on goods sent to branch (via Goods Sent to Branch A/c), (2) Branch Stock surplus, and (3) transfer of opening stock reserve. It is debited with: branch expenses, closing stock reserve, branch stock shortage, and the balancing profit/loss transferred to P&L.