Topics
Cost Control Accounts
Contract Costing
- Introduction to Contract Costing
- Contract Costing
- Process of Contract Account
- Contract Costing Concept
- Work Certified
- Work Uncertified
- Progress Payments
- Retention Money
- Cost Plus Contract
- Contract Account
- Accounting for Material
- Accounting for Tax Deducted at Source by the Contractee
- Accounting for Plant Used in a Contract
- Treatment of Profit on Incomplete Contracts
- Contract Profit and Balance Sheet Entries
Process Costing
Introduction to Marginal Costing
- Introduction to Marginal Costing
- Advantages of Marginal Costing
- Disadvantages of Marginal Costing
- Application of Marginal Costing
- Marginal Cost
- Contribution
- Profit/Volume (P/V) Ratio
- Margin of Safety (Mos)
- Break-even Point
- Contribution Margin Technique
- Break-even Chart
- Profit Volume Graph
- Cost Volume Profit Analysis
Introduction to Standard Costing
Some Emerging Concepts of Cost Accounting
Related QuestionsVIEW ALL [2]
Modern Contractors have undertaken the following two contracts on 1st January, 2017.
| Particulars | Contract A(Rs.) | Contract B(Rs.) |
| Materials sent to sites | 85,349 | 73,267 |
| Labour engaged on sites | 74,375 | 68,523 |
| Plant installed at sites at cost | 15,000 | 12,500 |
| Direct expenditure | 3,167 | 2,859 |
| Establishment charges | 4,126 | 3,852 |
| Materials returned to stores | 549 | 632 |
| Work certified | 1,95,000 | 1,45,000 |
| Materials in hand on 31st Dec. 2017 | 1,883 | 1,736 |
| Cost of work not certified | 4,500 | 3,000 |
| Wages accrued on 31 51 Dec. 2017 | 2,400 | 2,100 |
| Direct expenditure accrued on 31 Dec. 2017 | 240 | 180 |
| Value of plant on 31st Dec. 2017 | 11,000 | 9,500 |
The contract prices have been agreed at Rs. 2,50,000 for Contract A and Rs. 2 00 000 for Contract B. Cash has been received.from contractors as follows:
Contract A Rs. l,80,000 and Contract B Rs. 1,40,000.
Prepare Contract Accounts, Contractee's Account and show how the Work-in-Progress will appear in the Balance Sheet of the contractor.
X Ltd. is engaged in two contracts, A and B during the year .
The following information is available at 31st Dec. 2017.
| Date of Commencement | Contract - A (Rs.) | Contract - B (Rs.) |
| Contract Price | 6,00,000 | 5,00,000 |
| Materials delivered to site | 1,20,000 | 50,000 |
| Material issued from store | 40,000 | 10,000 |
| Material returned to store | 4,000 | 2,000 |
| Material on site 31st Dec. 2017 | 22,000 | 8,000 |
| Direct labour payments | 1,40,000 | 35,000 |
| Direct expenses | 60,000 | 30,000 |
| Architect's fees | 2,000 | 1,000 |
| Establishment charges | 25,000 | 7,000 |
| Plant installed at cost | 80,000 | 70,000 |
| Value of Plant on 31st Dec. 2017 | 65,000 | 64,000 |
| Accrued wages 31st Dec. 2017 | 10,000 | 7,000 |
| Accrued expenses 31st Dec: 2017 | 6,000 | 5,000 |
| Cost of contract not certified by architect | 23,000 | 10,000 |
| Value of contract certified by architect | 4,20,000 | 1,35,000 |
| Cash received | 3,78,000 | 1,25,000 |
During the period, materials amounting to Rs. 9,000 have been transferred from Contract A to Contract B. You are required to show :
(a) Contract Alc,
(b) Contractee 's Alc, and
(c) Extract from Balance Sheet as on 31st Dec. 2017 showing the calculation of WIP.
