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Goods sent by HO to dependent branch can be invoiced at:
ACost only
BCost plus a fixed loading (selling/wholesale price)
CVariable price each quarter
DNone of the above
Answer & Solution
Correct answer: B. Cost plus a fixed loading (selling/wholesale price)
1. Step 1: Per Ch 15, goods may be sent at cost, at wholesale price, or at invoice price including a loading.
2. Step 2: The loading represents HO's mark-up to branch.
3. Step 3: Hence (B).
_Source: ICAI BoS CA Inter Paper 1, Ch 15 "Accounting for Branches including Foreign Branches"_