The carrying amount of contract costs relating to a performance obligation and recognised as an asset is $144,000. Further costs required in order to satisfy the obligation are estimated to be $36,000. The consideration receivable by the company when the obligation is satisfied is $158,400. Calculate the amount of the impairment loss (if any)

Q: Sony Inc. is a lessor-manufacturer of expensive machinery. On January 1,2011, a machinery is leased…

A: A lease is a type of transaction in which the owner of the asset (called the Lessor) lets the asset…

Q: More than 10% of the taxable revenue can be deducted from maintenance and depreciation expenses.

A: Taxable revenue is the revenue which the company earns during the year which are subject to the tax…

Q: On February 20, 2022, ABC Construction Company entered into a fixed-price contract to construct a…

A: Calculation of total Amount of Contract Costs charged to Profit and Loss in 2022::: Total Estimated…

Q: On January 1, 2018, Liquid Company accepted a long-term construction project for an initia contract…

A: The financial ratio that demonstrates the link between gross profit and net sales is gross profit…

Q: Given the problem: Conduits made of Timber…

A: First cost (F) = $50025.34 n = 13 years Scrap value (S) = $2992 Annual cost (A) = $1301 r = 8.6%

Q: Eagle Limited has a three-year contract; at the 31 December 2020 the outcome of the contract cannot…

A: To the Directors of Eagle Limited Subject: Accounting Treatment of Long-Term Contract under IFRS 15…

Q: N.B:SHOW ALL STEPS USED WITH CLEAR DETAILS AND EXPLANATIONS .

A: PPE (property, plant, and equipment) acquisition is the process of acquiring or building durable…

Q: Karane Enterprises, a calendar-year manufacturer based in College Station, Texas, began business in…

A: (a)

Q: Jeff Irvin Company provided the following information for the current year: Current service cost…

A: Total defined cost = Current service cost + Interest on PBO +  Loss on settlement + past service…

Q: Entity 2 entered contracts with two separate customers on 1 January 2022. The following information…

A: Please note that this answer assumes that there are no other relevant factors or adjustments…

Q: On 1 January 2022 (the contract date), Furniture Ltd sold R1 200 000 worth of furniture to a new…

A: As per the accounting standard (IFRS 15) Revenue from contracts with customer which is based on 5…

Q: 1 Alessor has designed and built equipment based on the lessee specifications for molding unique…

A: In order to classify a lease based on no alternative use—which indicates that the lessee has…

Q: Prepare journal entry on January 1, 2027 to record the return of the machinery to the lessor. Assume…

A: The lease can be obtained by a company for those assets for which a company does not want to be in a…

Q: What is the carrying value of the right of use asset on December 31, 2021? ₱ 1,175,000   ₱…

A: Right of use asset initial recognition on January 1 2021 = Present value of lease payments +initial…

Q: The depreciation charges for the year to 31 March 2021 are to be apportioned as follows: Cost of…

A: Allocation of Expenses = Expense can be allocated according the decided according the different…

Q: ShoSho Manufacturing is being sued for illness caused to local residents as a result of negligence…

A: Contingent Liability: It implies to a liability that may arise or may not arise depending upon an…

Q: e the folloreing inforination JOr the Hext two questions: antract. Information on the construction…

A: Calculation of revenue to be recognized in 2002 POC %= Cost incurred till date/Estimated total…

Q: Question For an engineering project, the following payments have been estimated to be paid at their…

A: The cash flows refer to the inflow and outflow of cash from the business and any entity. The cash…

Q: Company W sold services with a stand-alone fair value of $7,000 and equipment with a stand-alone…

A: Here,Fair Value of Services is $7,000Fair Value of Equipment is $25,000Discount Rate is 7%Contract…

Q: Required: (a) Discuss four areas of judgement in relation to depreciation within financial…

A: Depreciation is the decrease in the value of asset over a period of time due to usage, wear and tear…

Q: On 1 January 2021 Bob Company sells an item of machinery to Jaison Company for its fair value of…

A:

Q: On 30 June 2020, Cambridge Ltd leased a vehicle to Awamutu Ltd. Cambridge Ltd had purchased the…

A: What is meant by Lease? It is an agreement between two parties in which one party agrees to…

Q: What amount should be recognized by Ripple as profit from sale for the year ended December 31, 2020?…

A: Lease means giving out the assets by lessor to lessee to use that assets in return of rent.…

Q: In 20x1, ABC Co. enters into a contract to construct a building for a customer. ABC identifies its…

A: The profits or losses are calculated as difference between revenue and expenses of the current…

Q: On December 31,2020 the account for Shane Oil Company's individually insignificant unproved…

A: Answer A. Assuming Shane Oil Company’s has a policy of maintaining a 60% allowance, i.e., 60% of…

Q: Which of the following should be shown on the statement of financial position at December 31, 2023…

A: It is a method used for accounting for construction contracts. In this approach, revenue is…

Q: A business buys a machine for £60,000 and depreciates it at 10% per annum by the reducing…

A: We have the following information: Cost of Machine: $60,000 Rate of depreciation: 10% per annum…

Q: How much profit is recognized from the contract in 20x1?

A:

Q: What is the fair value of the plan asset as of December 31, 2014

A: Fair value of the plan asset at the end is value of the plan assets which has been computed by the…

Q: On December 31, 2021, Maroon Co. leased an equipment with a cot of P2,000,000 to Green Co. for 5…

A:

Q: The following information were deemed relevant regarding a sale and leaseback agreement GEE Corp.…

A: An agreement of contract that is prepared to transfer the right to use the resources for a…

Q: You bse iequiued to account Showing the position of Contract 20. 4. 2014 fecom the folloowing…

A:

Q: [A] The franchisor will initially recognize P20,000 contract asset. [B] The franchisor will…

A: Franchise Agreement To recognize the revenue in the franchise agreement either in the point of time…

Q: The contract ledger of a company indicates the under mentioned expenditures on the Account of…

A:

Q: A permanent investment has an initial cost of $3.550.000 and an annual income of $234,500. What is…

A: ROR Analysis is also known as Rate of Return analysis which determines the adequate rate of return…

Q: Assume that a $2 million factory is insured and sustains a $700,000 loss. If pro rata coverage…

A: Insurance: It is an arrangement made by a company with a third party called insurer, who agrees to…

Q: The amount of the average investment for a proposed investment of $147,000 in a fixed asset with a…

A: Formula: Average investment = (Initial value of investment + Closing value of investment) / 2

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.