Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help with below accounting problem At the end of 20X8 company OMEGA had 3 contracts in progress (all started in 20X8), details of which

Please help with below accounting problem

image text in transcribed
At the end of 20X8 company OMEGA had 3 contracts in progress (all started in 20X8), details of which are as follows: Contract 1 Contract 2 Contract 3 Total contract price 600 000 800 000 780 000 Value of performance obligation satisfied to 31 Dec 20X8 600 000 Costs to date 31 Dec 20X8 250 000 750 000 585 000 Expected costs to completion 280 000 0 90 000 Amounts invoiced to 31 Dec 20X8 260 000 700 000 510 000 Cash received to 31 Dec 20X8 250 000 650 000 465 000 If it's possible to measure value of performance obligation satisfied to date, then revenue and expenses are recognised on the basis of work certified, otherwise they are measured on the basis of relation of costs to date to total costs. Required: Calculate amounts (separately for each contract) of revenues, cost of sales, profit, contract assets and receivables that should be recognised in the Statement of profit and loss and in the Statement of financial position for the year 20X8. (12 points)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting

Authors: Heintz and Parry

20th Edition

1285892070, 538489669, 9781111790301, 978-1285892078, 9780538489669, 1111790302, 978-0538745192

More Books

Students also viewed these Accounting questions

Question

Values: What is important to me?

Answered: 1 week ago

Question

Purpose: What do we seek to achieve with our behaviour?

Answered: 1 week ago

Question

An action plan is prepared.

Answered: 1 week ago