Question

ABC Co. Ltd., Furnishes you with the following information for the year ended 31.03.2017 and 31.03.2018

Year Ended	31.03.2017(Rs.)	31.03.2018(Rs.)
Material Issued	13,000	24,700
Sub-contract Charges	4,500	20,000
Work Certified during the year	20,000	80,000
Closing Stock of Material at Site	3,000	-

The total Contract price is Rs. 1,00,000. The entire amount was received by 31.03.2018. As per the accounting policy adopted by the company, no profit is to be considered unless the value of work certified at the year end exceeds 25% of the Contract Price.
Prepare Contract Account for the year ended 31st March, 2~ 17 and 31st March, 2018.

Answer 1

M/s. ABC Co. Ltd.

Dr.

Contract Alc (for the Year ended 31.03.2017)

Cr.

Particulars	(Rs.)	Particulars	(Rs.)
To Material Issued	13,000	By WIP C/f.
To Sub-contract Charges	4,500	Work Certified clf.  20,000
To WIP c/f. (Provision for Contingencres)	5,500	Material at Site clf.  3,000	23,000
	23,000		23,000

Dr.

Contract Alc (for the Year ended 31.03.2018)

Cr.

Particulars	(Rs.)	Particulars	(Rs.)
To WIP b/f.
Work Certified b/f.  20,000		By WIP c/f. (Provision for Contingencies)	5,500
Material at Site b/f.  3,000	23,000	By Contract Alc	1,00,000
To Material Issued	24,700
To Sub-contract Charges	20,000
To Profit and Loss Alc.	37,800
	1,05,500		1,05,500