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MASLI Islamic Bank entered into an Istisna' contract with Pembinaan Berhad to build a factory in Ipoh, Perak for RM500,000, to be completed in 2
MASLI Islamic Bank entered into an Istisna' contract with Pembinaan Berhad to build a factory in Ipoh, Perak for RM500,000, to be completed in 2 years.Total costs is RM400,000 (including pre contract cost of RM 25,000). Additional detail information as follows:
Year 1 Year 2
Cumulative costs incurred 300,000 400,000
Billings 280,000 220,000
Collections from purchaser(almustasni)230,000 270,000
Required:
Journalise the above said transactions pertaining to the above istisna' assuming the bank adopts the percentage completion method.
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