| Pack Corporation Contract Accounting |
| Contract completion percentage |
| | 2020 | 2021 | 2022 |
| | $ | $ | $ |
| Contract cost to date | 300,000 | 1,200,000 | 2,000,000 |
| Estimated cost to completion | 1,200,000 | 800,000 | 0 |
| Total cost | 1,500,000 | 2,000,000 | 2,000,000 |
| Completion percentage | Cost incured to date x100 |
| | Total cost |
| | 300000x 100= 20% | 1200,000 x100 =60% | 2,000,000 x 100= 100% |
| | 1,500,000 | 2,000,000 | 2,000,000 |
| Total gross profit/loss |
| particular |
| Contract price | 2,200,000 | 2,200,000 | 2,200,000 |
| Less total estimated cost | -1500000 | -2,000,000 | -2,000,000 |
| GP/Loss | 700,000 | 200,000 | 200,000 |
| Realized profits Under revenue recognition over time |
| for the year ended 31st Dec 2020,2021 and 2022 |
| | 2020 | 2021 | 2022 |
| Gross profit for the year | 0 | 120,000 | 80,000 |
| Accumulated Gross profit for the year | 0 | 120,000 | 200,000 |
| Park Corporation Journal Entries |
| As at 31 December 2020 |
| | DR | CR |
| Particulars | $ | $ |
| construction cost | 12000000 |
| Materials | | 12,00,0000 |
| Accounts recievable | 300,000 |
| Billing | | 300,000 |
| cash received | 200,000 |
| Accounts recievable | | 200,000 |
| Park Corporation Journal Entries |
| As at 31 December 2021 |
| | DR | CR |
| Particulars | $ | $ |
| To record cost |
| construction cost | 800000 |
| Materials | | 800000 |
| To record billing |
| Accounts recievable | 900000 |
| Billing | | 900000 |
| To record payment |
| cash received | 800000 |
| Accounts recievable | | 800000 |
| Park Corporation Journal Entries |
| As at 31 December 2022 |
| | DR | CR |
| Particulars | $ | $ |
| To record cost |
| construction cost | 2,000,000 |
| material | | 2,000,000 |
| To record billing |
| Accounts recievable | 1,000,000 |
| Billing | | 1,000,000 |
| To record payments |
| Cash | 1,200,000 |
| Accounts recievable | | 1,200,000 |
| Pack Corporation Balance sheet |
| As at 31st December 2020 |
| Particulars | $ |
| Current assets |
| Debtors 300,000-200,000 | 100,000 |
| Realized profits Under revenue recognition over time |
| for the year ended 31st Dec 2020,2021 and 2022 |
| | ($) 2020 | ($) 2021 | ($) 2022 |
| Accumulated GP 20% x 200,000 | 40,000 | 80,000 | 80,000 |
| Workings |
| year 2021 |
| 60% x 200,000 =120000-40,000 =80,000 |
| year 2022 |
| 100/100x 200,000 = 200,000-120,000=80,000 |
| Journal entries under point in time 2020 |
| Cost incured | DR ($) | CR ($) |
| Work in progress | 800000 |
| Accounts payable | | 800000 |
| Billing |
| Account recievable | 300000 |
| Billing | | 300000 |
| Received payment |
| Cash | 200000 |
| Accounts recievable | | 200000 |
| Journal Entries under point in time 2021 |
| Particulars | DR ($) | CR ($) |
| Cost incured |
| Construction cost | 800000 |
| Material | | 800000 |
| Billing |
| Accounts recievable | 900000 |
| Billing account | | 900000 |
| Received payment |
| Cash | 800000 |
| Recievables | | 800000 |
| Journal Entries under point in time 2022 |
| Cost incured |
| Contract cost to completion | 2000000 |
| Material | | 2000000 |
| Billing |
| Accounts recievable | 1000000 |
| Billing | | 1000000 |
| Received payments |
| Cash | 1200000 |
| Accounts recievable | | 1200000 |
| Balance sheet as at 31 Dec 2020 |
| Particulars |
| Current Asset | $ |
| Debtors | 100,000 |
| WIP (300,000+140,000-300,000) | 140,000 |
| total assests | 240,000 |
Clark1026
homework3.xlsx
