Jamaica Contractors Ltd started work on a contact on January 17, 2016 and finished on October 21, 2016. Costs…

Jamaica Contractors Ltd started work on a contact on January 17, 2016 and finished on October 21, 2016. Costs…

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Jamaica Contractors Ltd started work on a contact on January 17, 2016 and finished on October 21, 2016. Costs…
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Jamaica Contractors Ltd started work on a contact on January 17, 2016 and finished on October
21, 2016. Costs on the contact are provided in the table below:
Details
Direct materials
Direct labour
Direct expenses
Plant costs
Overheads
Total
The price of the contract was $8,000,000 and on October 28, 2017 the inspector of the job issued
the final certificate of work done. As at that date the customer had already paid $6,000,000 and
the remainder was still outstanding at the end of the accounting period. Direct materials valued at
$40,000 was returned to store, while direct labour was pre-paid to the extent of $100,000.
Required:
S
2,400,000
2,100,000
480,000
360,000
660,000
6,000,000
(a) Prepare the contract account as at December 31st 2016.
(10 marks)
(b) Prepare the contract P&L account for the year ended December 31st 2016. (5 marks)
(c) Prepare the Contractee Account to show the amount outstanding as at December 31st,
2016. (5 marks)
(d) List three characteristics of job costing and state the main difference between it and
contact costing (5 marks)

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a Contract Account as at December 31 2016 Contract Account For the Year Ended December 31 2016 Debit
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