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Construction Contracts Ans

This document discusses construction contract accounting and provides examples of calculating percentage of completion, contract income, and current assets. It addresses topics like calculating income for multiple projects, determining percentage of completion based on costs, recognizing income for contracts over multiple years, and accounting for cost plus fixed fee contracts. Worksheet examples are provided to illustrate concepts like computing income as completion progresses.

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79 views

Construction Contracts Ans

This document discusses construction contract accounting and provides examples of calculating percentage of completion, contract income, and current assets. It addresses topics like calculating income for multiple projects, determining percentage of completion based on costs, recognizing income for contracts over multiple years, and accounting for cost plus fixed fee contracts. Worksheet examples are provided to illustrate concepts like computing income as completion progresses.

Uploaded by

jessica amoroso
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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ARTS-PRTC CPA Review

CONSTRUCTION CONTRACTS
PAS 11
AFAR MICHAEL B.BONGALONTA,CPA,MICB,MBA

CONSTRUCTION CONTRACTS

1. Project 1 420, 000


(240, 000)
(120, 000)
60, 000
X 2/3
40, 000

Project 2 300, 000


(280, 000)
( 40, 000)
(20, 000)

2. Percentage of completion = 40, 000 – 20, 000 = 20, 000 gain

3. Contract Price 9, 000, 000


Estimated TC @ Completion 8, 100, 000
900, 000
Percentage of Completion 63/81
700, 000- Beginning 2010

Contract Price 9, 000, 000


Estimated TC @ Comp ’08 7, 800,000
1, 200, 000
POC ’08 39/78 600, 000 – Beginning 2009
Income 100, 000

4. CIP 2010 CIP 2009


364, 000 - 122, 000= 192, 000 (Cost of 2010) = 50, 000

5. 2009 20% 2010 8, 000, 000 x 60%= 4, 800, 000


2010 60% 2009 7, 500, 000 x 40%= 1, 500, 000
40% 3, 300, 000

%= Cost to Date/ Estimated cost at completion

6. 100, 000 Loss


7. Current 300, 000 Left
8. 0
9. 13, 333
10. Cost Plus Fixed Fee
POC= 700/2100 = 1/3
11. 47, 000-15, 000= 32, 000
12. 160, 000
CIP
13. 4, 000, 000 4, 250, 000
4, 250, 000 (250, 000)
(250, 000) 4, 000, 000
(3, 600, 000)
400, 000 CURRENT ASSETS

14. 20%
15. 62, 500 CURRENT ASSETS

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