Answered: In any construction project, the total…

In any construction project, the total bill to the owner must equal a. Gross profit b. Net profit c. Project contract amount d. General overhead

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter5: Adjusting Entries And The Work Sheet

Section: Chapter Questions

Problem 12SEB

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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

In any construction project, the total bill to the owner must equal
a. Gross profit
b. Net profit
c. Project contract amount
d. General overhead

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Similar questions

1. When outcome of a construction contract is estimated reliably, contract revenue and contract costs associated with the construction contract should be recognized using * A. cost recovery method B. percentage of completion method C.gross profit method D.zero profit method.
Under the completed-contract method, the Contract Asset/Liability account balance will consist of construction costs only. gross profit only. construction costs and gross profit. O construction costs and billings.
Which of the following is not an accepted basis for recognition of revenue?A. Passage of timeB. Completion of percentage of a projectC. Performance of serviceD. Upon signing of contract
progress payment made by the contractee to the contractor is credited to ____ account
Which of the following is not a fixed cost?a. Direct materialsb. Depreciationc. Lease charged. Property taxes
Classify the following fixed costs as normally being either committed or discretionary:a. Depreciation on buildings.
i. Define the term contract. State the objectives of Contract costing iii. Identify types of contracts Prepare simple contract accounts to show calculations for profit and loss on contracts Compute the profit on a long term contract Explain the treatment of contract losses in the accounting system iv. V. vi.
Cost includes all costs necessary to bring the asset to a working condition for its intended use. Which of these costs are taken as a part of cost of assets? I. Invoice price II. Transportation cost III. Installation charges I and II II and III I, II and III I and III
Current Attempt in Progress Tamarisk Company reports the following costs and expenses in May. Factory utilities Depreciation on factory equipment Depreciation on delivery trucks Indirect factory labor Indirect materials Direct materials used Factory manager's salary From the information: $14,800 12,120 3,840 47,120 77,440 132,480 8,000 Direct labor Sales salaries Property taxes on factory building Repairs to office equipment Factory repairs Advertising Office supplies used $66,480 44,320 2,400 1,280 1,920 14,400 2,510
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The primary issue in the accounting for construction contracts is the determination of the percentage of completion and revenue to be recognized during the period. the allocation of contract revenue and contract costs to the accounting periods in which construction work is performed. the determination of the rate at which physical performance has been made during the reporting period and the future performance on which future revenues will be allocated. the allocation of costs of a long-lived asset to permit the proper matching of costs with revenues.
Equipment costs charged to jobs is a contra account used to: Record the equipment costs that been allocated or charged to the construction company. Record the equipment costs that been allocated or charged to the sub-contractor. Record the equipment costs that been allocated or charged to the materials costs for a specific construction project. Record the equipment costs that been allocated or charged to the construction costs for a specific construction project.