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The following information pertains to the head office and thebranch of KATSE.Branch inventory on hand at selling price:1 January2017..................................................................................R3350031 December2017............................................................................R38900Transactions of the branch for the year ended 31December 2017:Inventory transferred to the branch (selling price)......................................... R 200 000Cash sales at the branch..............................................................................R 190 200Settlement discount granted to branch debtors............................................. R 2 796Branch administrative expenses paid by head office..................................... R 15 965Damaged inventory written off (at cost)......................................................... R 3000Additional information:1. Inventory is purchased by the head office and supplied to thebranch at selling price, which is costprice plus 25%. During August 2017 inventory with a selling priceof R2 175 was stolen at the branch.No entries have been made to record this theft.QUESTION 9Which of the following alternatives represents the correctsurplus/deficit in the branch inventory account?1. R 610 surplus2. R 610 deficit3. R1 525 surplus4. R 525 deficit