Explanation Journalizing: Journalizing is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the accounts are posted to the relevant ledger accounts. Accounting rules for journal entries: To increase balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue and gains. To decrease balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue and gains. Entry for actual cost incurred: Date Account Title and Explanation Post. ref. Debit ($) Credit ($) Construction in progress 24,000 Cash 24,000 (being cost of construction recorded) Table (1) Construction in progress account is an asset account. Since, the completion of the work increases the assets of the company. Hence, construction in progress is debited. Cash account is the assets account. Since, the cash has been paid to the suppler and worker due to which cash of the company has decreased. Hence, the cash account is credited. Entry for billing: Date Account Title and Explanation Post. Ref. Debit ($) Credit ($) Account receivables 61,000 Billing in receivable 61,000 (being billing recorded) Table (2) Accounts receivable is an asset account...

1st Edition

ISBN: 9780132162302

Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

Publisher: PEARSON

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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…

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Chapter 8.A, Problem 13BE

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Prepare journal entries.

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Chapter 8.A, Problem 12BE

Chapter 8.A, Problem 14BE

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Chapter 8.A Solutions

Intermediate Accounting

Ch. 8.A - Prob. 1Q Ch. 8.A - Prob. 2Q Ch. 8.A - Prob. 3Q Ch. 8.A - Prob. 4Q Ch. 8.A - Prob. 6Q Ch. 8.A - Prob. 7Q Ch. 8.A - Prob. 8Q Ch. 8.A - Prob. 12Q Ch. 8.A - Prob. 13Q Ch. 8.A - Prob. 14Q

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