Which of the following is correct about the treatment of this transaction?

Goods worth N50 000 were sent at different times from head office to the branch during the year.
By the end of the period, only N40 000 worth of goods had arrived at the branch. Which of the following is correct about the treatment of this transaction?

A. Branch should debit goods received from head office with N50 000
B. Head office should debit goods sent to branch account with N10 000
C. Head office should debit goods sent to branch account with N50 000
D. Branch should debit goods received from head office with N10 000

Correct Answer:

Option B – Head office should debit goods sent to branch account with N10 000