Professional Documents
Culture Documents
Contract Costing
BILMA 005
MAHESH 013
SAURABH 029
ANANT 040
VAIBHAV 047
SHOBHIT 053
RAHUL 055
Contract Costing
y Contract
C t t costing
ti applies
li where
h th
the work
k iis undertaken
d t k tto
customer’s special requirement which lasts for longer
duration
y Ex :- construction of road
road, building
building, dams
dams, bridges
bridges, and
other civil engineering works
Important Terms used in Contract costing
3
3. Plant and Machinery
-Purchased for a particular contract • Total cost.
and exhausted at site.
-If
If not sold. • Value depreciated.
-If
If taken
t k on hi
hire. • Hire
Hi charges
h with
ith
no depreciation.
# Cost kind Debit Credit
4. Sub Contract
Sub-Contract • Direct charge to the
-Payments made. main contract with
-Materials issued. no break-up.
-Heavy
H tools
t l and dE
Equipments
i t • Depreciation
D i ti
supplied on a rental basis. charged.
5.
5 Expenses
p
Other than material and wages • Direct or indirect
charged to individual contracts.
Profit on Incomplete Contracts
CONTRACT PROFIT
COMPLETION CALCULATION
No profit should be
< 25 % computed and credited to
the profit and loss account
1/3 * Notional Profit *
> 25 % and < 50 % (Cash received/Work
Certified )
Notional Profit =Value of work certified - (cost of work to
date – cost of work not yet certified)
CONTRACT PROFIT CALCULATION
COMPLETION
Between 50 % and 90 % 2/3 * Notional Profit * ( Cash
Received/Work Certified )
90 % or > 90 % Estimated
st ated Profit
o t * ( Wo
Work
Certified/Contract Price )