On June 30, 2006, the unadjusted credit balance of the Allowance for Overvaluation of Inventories: Cyprus Branch ledger account in the accounting records of the home office of Wilmington Company was $60,000. The home office of Wilmington ships merchandise to the branch at a markup of 20% on home office cost. For the fiscal year ended June 30, 2006, the branch had reported a net loss (based on billed prices of merchandise shipped from home office) of $18,400 and ending inventories (all received from home office) of $132,000 at billed prices.
Prepare journal entries for the home office of Wilmington Company on June 30, 2006, to record the foregoing information.

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The Answer of On June 30, 2006, the unadjusted credit balance of the Allowance for Overvaluation of Inventories: Cyprus Branch ledger account in the accounting records of the home office of Wilmington Company was $60,000. The home office of Wilmington ships merchandise to the branch at a markup of 20% on home office cost. For the fiscal year ended June 30, 2006, the branch had reported a net loss (based on billed prices of merchandise shipped from home office) of $18,400 and ending inventories (all received from home office) of $132,000 at billed prices.
Prepare journal entries for the home office of Wilmington Company on June 30, 2006, to record the foregoing information.

On June 30, 2006, the Unadjusted Credit Balance of the Allowance