Illustration 8 Deluxe Limited undertook a contract for $ 5,00,000 on 1st July, 2017. On...
80.2K
Verified Solution
Link Copied!
Question
Accounting
Illustration 8 Deluxe Limited undertook a contract for $ 5,00,000 on 1st July, 2017. On 30th June, 2018 when the accounts were closed, the following details about the contract were gathered: $ $ Materials Purchased 1,00,000 Wages Accrued 30-6-2018 5,000 NVages Paid 45,000 Work Certified 2,00,000 General Expenses 10,000 Cash Received 1,50,000 Plant Purchased 50,000 Work Uncertified 15,000 Materials on Hand 30-6-2018 25,000 Depreciation of Plant 5,000 The above contract contained an escalation clause which read as follows: "In the event prices of materials and rates of wages increase by more than 5%, the contract price would be increased accordingly by 25% of the raise in the cost of materials and wages beyond in account the effect of Prepare the contract account. Working should form part of the
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
