ABC Co. Limited has undertaken a contract for $ 2,00,000 on April 2018. Prepare a Contract Account and the Balance Sheet in T format from trial balance and the adjustment given below: THE TRIAL BALANCE as on March 31,2019 Particulars Dr. Amount($) Cr. Amount($) Share Capital Cash Received on Contract (80% of Work certified) Plant and Tools 40,000 1,00,000 12,200 44,250 56,180 25,000 Materials Sent to site Labour Charges Land and Building Sundry Creditors General Expenses Cash in Hand Total Material returned to store is $ 2,125. Of the plant and tools sent to siu plant worth$ 1,300 4,380 4,650 2,100 1,44,380 1,44,380 were lost due to carelessness of the staff. The value of the plant and tools as on 31-3-2019 was $ 8,000. Reserve 1/3 of the profit. The work completed but not certified is $ 6,145. Assume that this was the only contract in hand 2018-2019.

ABC Co. Limited has undertaken a contract for $ 2,00,000 on April 2018. Prepare a Contract Account and the Balance Sheet in T format from trial balance and the adjustment given below: THE TRIAL BALANCE as on March 31,2019 Particulars Dr. Amount($) Cr. Amount($) Share Capital Cash Received on Contract (80% of Work certified) Plant and Tools 40,000 1,00,000 12,200 44,250 56,180 25,000 Materials Sent to site Labour Charges Land and Building Sundry Creditors General Expenses Cash in Hand Total Material returned to store is $ 2,125. Of the plant and tools sent to siu plant worth$ 1,300 4,380 4,650 2,100 1,44,380 1,44,380 were lost due to carelessness of the staff. The value of the plant and tools as on 31-3-2019 was $ 8,000. Reserve 1/3 of the profit. The work completed but not certified is $ 6,145. Assume that this was the only contract in hand 2018-2019.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.

Question

ABC Co. Limited has undertaken a contract for $ 2,00,000 on April 2018.
Prepare a Contract Account and the Balance Sheet in T format from trial balance
and the adjustment given below:
THE TRIAL BALANCE
as on March 31,2019
Particulars
Dr. Amount($) Cr. Amount($)
Share Capital
Cash Received on Contract (80% of Work certified)
Plant and Tools
40,000
1,00,000
12,200
44,250
56,180
25,000
Materials Sent to site
Labour Charges
Land and Building
Sundry Creditors
General Expenses
Cash in Hand
Total
Material returned to store is $ 2,125. Of the plant and tools sent to siu plant worth$ 1,300
were lost due to carelessness of the staff. The value of the plant and tools as on 31-3-2019
was $ 8,000. Reserve 1/3 of the profit. The work completed but not certified is $ 6,145.
4,380
4,650
2,100
1,44,380
1,44,380
Assume that this was the only contract in hand 2018-2019.

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