JAMB Accounts Principles of Accounts 2010 Paper

Concept:When the head office pays expenses on behalf of a branch, it must record the expense and show the decrease in its bank balance.Explanation:The payment is an expense incurred for the branch, so the business needs to recognise it in an expense account.Since the head office pays cash from its bank account, the bank balance reduces.In double entry, the expense is debited and the bank account is credited.Therefore, the correct recording is to debit the branch expenses account and credit the bank account.This matches option B.Answer:B. expenses account and crediting bank account.