Khush Construction Co.undertook a contact for constructing a bridge for a total value of Rs. 12 lakhs on 1 January 2009. It was estimated that the contract would be completed by 30 June 2010. You are required to prepare a contract account for the year ending 31 December 2010.
|
Wages |
3,00,000 |
|
Materials |
1,50,000 |
|
Materials at site on 31 December 2009 |
20,000 |
|
Special plant |
1,00,000 |
|
Overheads |
60,000 |
|
Work certified |
8,00,000 |
Depreciation is at 10%p.a. on plant. Cash received is 80%of the work certified. 8%of the value of materials issued and 7%of wages may be taken to have been incurred for the portion of the work completed but not yet certified. Overheads are charged as a percentage of direct wages.