Leni Company had a balance of P820,000 in the professional fees expense account on December 31, 2020, before considering year-end adjustments relating to the following: ➢Consultants were hired for a special project at a total fee not to exceed P650,000.The entity had recorded P550,000 of these fees based on building for work performed in 2020. ➢The attorney’s letter requested by the auditor dated Jan. 31, 2021, indicated that legal fees of P60,000 were billed on Jan. 15, 2021 for worked performed in Nov.2020, and the unbilled fees for Dec. 31, 2020 were P70,000. What amount should be reported as professional fees expense for the year ended December 31, 2020?

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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.