Accounting · Contract Costing Calculations
Universal Engineering and Construction (UEC) secured a four-year contract on January 1, 2023, for a contract price of 800,00,000 rupees. As of December 31, 2024, the records indicate: - Total Cost Incurred to date: 400,00,000 rupees - Estimated Future Cost to Completion: 300,00,000 rupees - Value of Work Certified by Architect: 500,00,000 rupees - Cash Received from Contractee: 400,00,000 rupees - Cost of Work Not Yet Certified: 20,00,000 rupees Based on these details, what is the Total Estimated Profit, the Notional Profit, and the profit transferred to the P&L Account for 2024 using standard contract costing principles?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Total Estimated Profit: 100,00,000 rupees; Notional Profit: 100,00,000 rupees; P&L Transfer: 66,66,667 rupees
- 2Total Estimated Profit: 100,00,000 rupees; Notional Profit: 120,00,000 rupees; P&L Transfer: 64,00,000 rupees✓
- 3Total Estimated Profit: 80,00,000 rupees; Notional Profit: 100,00,000 rupees; P&L Transfer: 53,33,333 rupees
- 4Total Estimated Profit: 120,00,000 rupees; Notional Profit: 80,00,000 rupees; P&L Transfer: 60,00,000 rupees
Correct answer
Total Estimated Profit: 100,00,000 rupees; Notional Profit: 120,00,000 rupees; P&L Transfer: 64,00,000 rupees
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