A company in the civil engineering industry with headquarters locate in Accra undertakes contract anywhere in Ghana

The company has had its tender for a job in Kumasi Accepted for GHS 288,000 and work is due to begin in June 2020. However, the company has also been asked to undertake a contract on the Coast of Accra. The price offered for this contract is GHS 352,000. Both of the contracts cannot be undertaken simultaneously because of constraints on staff site management personnel and on plant available. An escape clause enables the company to withdraw from the contract in Accra, provided notice is given before the end of April, 2020 and an agreed penalty of GHS 28,000 is paid.

The companys quantity surveyor has submitted the following estimates Cost Estimates
Kumasi			Coastal Accra
GHS			GHS
Materials:
In inventory at original cost, Material X			21,600
In inventory at original cost, Material Y			24,800
Firm orders placed at original cost, Material X			30,400
Not yet ordered - Current cost, Material X			60,000
Not yet ordered - Current cost, Material Z		71,200
Labour - hired locally	86,000			110,000
Site management	34,000			34,000
Staff accommodation and travel for site management	6,800			5,600
Plant on site - depreciation	9,600			12,800
Interest on capital	5,120			6,400
Total local contract cost	253,520			264,800
Headquarters cost allocated at 5% to total contract cost	12,676			13,240
Contract Cost	266,196			278,040
Contract Price	288,000			352,000
Estimated Profit	21,804			73,960

Required:

As a management accountant to the company, present comparative statements to show the net benefit to the company for undertaking the more advantageous of the two contracts.

Explain the reasoning behind the inclusion and omission from your comparative financial statement for each item given in the cost estimates and the notes relating thereto