Requirements: 1. Contract Account 2. Contractees Account 3.

Costing Profit & Loss Account( If given Profit on Sale of material or loss on sale of material, Material or Plant loss by accident in question) 4. Balance Sheet Necessary Working: 1. % of work certified on Contract value 2. Calculation of profit to be taken to Income statement/ Profit & Loss A/C 3. Cash Received 4. Value of Work Certified 5. Value of Uncertified work 6. Valuation Work-In-progress 7. Calculation of Depreciation 8. Progress payment

WORKING FORMULA 1. % Of Work certified on Contract Value = 2. Cash Received = Work Certified - Retention money 3. Value of Work Certified = 4. Valuation Work-In-progress:

100 100
Or 000 000 000 000 000 Cash Receive + Retention money

Cost of work done Add: Profit Less: Cash receive

5. Profit Determination of Contract: When the Percentage of work certified on contract value is less than 25%: No profits transferred to profit and loss account/ Income statement than total amount will be PROVISION. When the Percentage of work certified on contract value is 25% but less than 50% : Profit = Notional Profit

When the Percentage of work certified on contract value is 50% but less than 100% : Profit = Notional Profit

In case of loss: The entire loss to be transferred to Income statement/Profit & Loss Account.

6. Calculation of Depreciation = 7. Value of Uncertified work: 000 000 000 000 000 8. Progress Payment = Value of work certified - Retention money -Payment mode to date Total Cost to date Less: Cost of Work Certified Materials on hand Plant at site

Name of company . . . . . . . Contract Account Dr. For the year ended 31st Dec 2011 Particular Taka Particular Materials: Closing or Ending Materials Purchase 000 Materials on hand From store 000 Material return to store From other contract 000 000 Material return from site All expense 000 Materials supplied to other Wages, Labor, Salary expense 000 contract Depreciation exp on Assets 000 Materials lost by accident General exp,Sundry exp,Direct exp 000 Salvage value of wastage Other exp, Overhead exp, Rent exp 000 Destroyed by fire Miscellaneous exp, Hire of crane 000 All Abnormal loss in plant & Share of general overhead 000 Materials Management exp,Sub contract exp 000 Defective work, Indirect exp Supervisors salary, Engineer 000 salary, Provision for sub contract 000 Provision for rectification 000 Architect fee, Hire of plant Establishment exp, Overhead absorbed, Materials delivered to 000 site Machinery installed at site, Plant 000 installed cost Cost of work done c/d 000 Cost of work done b/d Notional Profit: Profit Provision 000 000 000 000 000 Work certified Uncertified Work

Cr. Taka 000 000 000 000 000 000 000 000 000

000 000 000 000

000

Provided by: A.R. Niloy, CMA (ICMAB), MBS (Accounting), BBS (Hons), - National University of Bangladesh

Contractees Account Particulars Work certified Taka 000 000 Particulars Cash receive Balance c/d Taka 000 000 000

Profit & Loss Account Particulars Material loss by accident Balance c/d Taka 000 000 000 Particulars Profit on contract Profit on sale of material Taka 000 000 000

Balance sheet As at 31st Dece. 2011 Liabilities Share Capital Sundry Creditors/Accounts payable All Advance Income/Received All Accrued exp/Payable Bills payable/ Notes payable Depreciation Provision/ Accumulated Depreciation Profit & Loss Account Less: Abnormal loss 000 000 000 Add: Profit on sales of Assets 000 000 000 000 Taka 000 000 000 000 000 000 Assets Fixed Assets, Plant & Machinery Furniture & Building, Tools All Prepared & Advance Exp/payable All Accrued Income/ Receivable Debtors/ Accounts Receivable Bills Receivable/ Notes receivable Salvage value Debtor balance of profit & loss A/C Work- In- Progress Taka 000 000 000 000 000 000 000 000 000

Provided by: A.R. Niloy, CMA (ICMAB), MBS (Accounting), BBS (Hons), - National University of Bangladesh

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Loss by Accident: Loss by Accident _vKj Kvb Salvage value bv _vKj Dnv Contract A/C Gi wWU w`K eme Ges Balance sheet Gi `vqi w`K Profit nZ weqvM ne| Loss by Accident _vKj Ges Salvage value _vKj Dnv Contract A/C Gi wWU w`K eme Ges Balance sheet Gi mwi w`K eme| Loss by Accident nZ Salvage value ev` w`q cKZ wZ ei KiZ ne hv bvg Contract A/C Gi wWU w`K eme Ges Balance sheet Gi `vqi w`K Profit nZ weqvM ne| Materials Sold with Profit: Kvb Materials jvf weq Kij aygv jvfi AskUzKz Balance sheet Gi `vqi w`K Profit Gi mv_ hvM ne| Materials Gi cKZ qg~j Materials Sold (Cost) bvg Contract A/C wWU w`K eme| Materials Sold with Loss: Kvb Materials wZZ weq Kij aygv wZi AskUzKz Balance sheet Gi `vqi w`K Profit nZ weqvM ne| Materials Gi cKZ Contract A/C wWU w`K eme| Plant Return to store: Plant Return to Store Bnv Balance sheet Gi mwi w`K Plant nZ weqvM Ges Avevi mwi w`K Avjv`v eme| Unused Plant Depreciation: Plant hw` Contract A/C G eenvi bv nIqv m I Depreciation aiZ ej Ze H Depreciation Balance sheet Gi `vqi w`K Profit nZ weqvM ne| Balance sheet Gi mwi w`K mswk Plant nZ weqvM ne| AsK Depreciation Provision _vKj AeeZ Plant Gi Depreciation Balance sheet Gi `vqi w`K Profit nZ weqvM Ges Depreciation Provision Gi mv_ hvM ne | mwi w`K Plant nZ weqvM w`Z ne bv|

Provided by: A.R. Niloy, CMA (ICMAB), MBS (Accounting), BBS (Hons), - National University of Bangladesh