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  • IFRS 15 PRT 2

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    baaz wings
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    This document provides information on two construction contracts. The first contract details include a $1.2 million price over 2 years, with costs of $900,000 after year 1 and $1,000,000 after year 2. Work certified was $720,000 after year 1 and $1.2 million after year 2. The second contract details a $40 million price over 2 years, with estimated costs of $25 million and actual costs of $10 million after year 1. Actual costs were $28 million after year 2. A $3 million machine was purchased and will be fully depreciated by year 2. Both contracts use the output method to recognize revenue and profit over time. Financial statements for years ending December 20

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    IFRS 15 prt 2

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    This document provides information on two construction contracts. The first contract details include a $1.2 million price over 2 years, with costs of $900,000 after year 1 and $1,000,000 after year 2. Work certified was $720,000 after year 1 and $1.2 million after year 2. The second contract details a $40 million price over 2 years, with estimated costs of $25 million and actual costs of $10 million after year 1. Actual costs were $28 million after year 2. A $3 million machine was purchased and will be fully depreciated by year 2. Both contracts use the output method to recognize revenue and profit over time. Financial statements for years ending December 20

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    13 views17 pages

    IFRS 15 PRT 2

    Uploaded by

    baaz wings
    This document provides information on two construction contracts. The first contract details include a $1.2 million price over 2 years, with costs of $900,000 after year 1 and $1,000,000 after year 2. Work certified was $720,000 after year 1 and $1.2 million after year 2. The second contract details a $40 million price over 2 years, with estimated costs of $25 million and actual costs of $10 million after year 1. Actual costs were $28 million after year 2. A $3 million machine was purchased and will be fully depreciated by year 2. Both contracts use the output method to recognize revenue and profit over time. Financial statements for years ending December 20

    Copyright:

    © All Rights Reserved
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    of 17

    Ifrs 15 f7

    Saturday, March 23, 2019 6:39 PM

    f7 starting standards Page 1


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    Contract started on 1st January 20X5
    Contract duration: 2 years
    Contract price: $1200,000
    Estimated total cost at the end of year 1: $900,000
    Actual total cost at the end of year 2: $1000,000
    Actual cost incurred in year 1: $600,000
    Actual cost incurred in year 2: $400,000
    Value of work certified at the end of December 20X5: $720,000
    Value of work certified at the end of December 20X6: $1200,000
    Co book revenue overtime and book profit using output method
    value of work certified to date ×100
    Total contract price

    Required: P&L and SOFP extract for the year ended 31 st December 20X5 and 20X6?

    f7 starting standards Page 4


    Q. Contract started on 1st jan 2007
    Total revenue of the contract = 40 million
    Total estimated cost at the end of year 1=25 m ( excluding depreciation)
    Actual cost incurred at the end of year 1 = 10 million
    Actual total cost at the end of year 2 = 28 m ( excluding depreciation)
    at the beginning of the contract company bought a machine for this contract for 3 m and scrap
    value of this machine at the end of yeAR 2 will be nil…
    company computes stage of completion on the basis of output method…
    Value of work certified to date at the end of year 1 = 24 million
    Company uses straight line method for depreciating machine
    Req …. Financial statement extract for the y/e 31 dec 2007 and 31 dec 2008=?

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