financial managemant, Financial Management

Assignment Help:
Task - 01

During its financial year ended 30 June 20x7 Beavers Ltd, an engineering company, has worked on several contracts. Information relating to one of them is given below.

Contract X201
Date Commenced 1 July 20X6
Estimated Completion Date 30 Sept 20X7
Contract Price RO 240,000
Proportion of work certified as satisfactorily completed (and invoiced) up to June 20X7 RO 180,000
Amount received from contractee RO 150,000
Costs up to 30 June 20X7
Wages RO 91,000
Material sent to site RO 36,000
Other contract costs RO 18,000
Proportion of head office costs RO 6,000
Plant and equipment transferred to the site (at book value on 1 July 20X6) RO 9,000
The plant and equipment is expected to have a book value of about RO 1,000 when the contract is completed.
Stock of materials at site on 30 June 20X7 RO 3,000
Expected additional costs to complete the contract
Wages RO 10,000
Materials (including stock at 30 June 20X7) RO 12,000
Other (including head office costs) RO 8,000
Company policy is to recognize profit on contracts as follows
Profit to be recognized = {Value of work certified / Total contract value} x Estimated total
Contract Profit

a) Prepare the Contract account.
b) The profit to be recognized on the Contract to date.
c) The amount to be shown on the company balance sheet as at 30 june 20X7 in respect on Contract X201 are:
a. Stocks
b. Debtors

Related Discussions:- financial managemant

Explain the effect of foreigners’ portfolio investments, As the early 1980s...

As the early 1980s, foreign portfolio investors have purchased an important portion of U.S. treasury bond issues. Discuss the short-term and long-term influences of foreigners’ por

Types of efficiency-efficient market hypothesis , Types of Efficiency   ...

Types of Efficiency    Efficient market theory can be described in three ways: 1) Allocative Efficiency: A market is allocatively proficient when it directs savings tow

Define accounts receivable are sometimes not collected, Accounts receivable...

Accounts receivable are sometimes not collected.  Why do companies extend trade credit when they could insist on cash for all sales? Extending trade credit almost all the time le

Criticize the flexible exchange rate regime, Criticize the flexible exchang...

Criticize the flexible exchange rate regime from the viewpoint of the proponents of the fixed exchange rate regime. If exchange rates are fluctuating very frequently, that may

Conversion value, Conversion value is the amount which investors wi...

Conversion value is the amount which investors will receive by immediately exchanging the bonds for equity stock and selling the stock at prevailing market

Banking sector securities, The banking sector has a vital and active ...

The banking sector has a vital and active role in the money market. The transactions taking place in these securities are large in size, both in terms of volumes

Compute the market price of walters model, The earnings per share of a comp...

The earnings per share of a company is Rs 8 and the rate of capitalization applicable is 10%. The company has before it, an option of adopting i) 50,ii) 75 iii) 100 per cent div

Assembling the divestiture team, Assembling the Divestiture Team: Dives...

Assembling the Divestiture Team: Divestment of a business requires a team of functional experts under the direction of an experienced project manager. The first and foremost ac

Define some instances of restrictive covenants, What are some instances of ...

What are some instances of restrictive covenants that might be fixed in a bond's indenture? An indenture might involve limitations on future borrowings, restrictions on dividen

Translation process among the monetary/nonmonetary method, Explain the dist...

Explain the distinction in the translation process among the monetary/nonmonetary method and the temporal method. Answer:  Within the monetary or nonmonetary method, every mone

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd