Page 168 - FR Integrated Workbook 2018-19
P. 168
Chapter 12
Illustration 7
The following information relates to a construction contract:
$
Contract price 500,000
Costs to date 300,000
Estimated costs to completion 100,000
Value of work certified to date 400,000
The stage of completion may be estimated either using cost values (inputs) or
sales values (outputs).
Inputs
Stage of completion is calculated by comparing costs to date to estimated
total costs:
300,000
= 75%
(300,000 + 100,000)
Outputs
Stage of completion is calculated by comparing work certified to date to total
contract price:
400,000
500,000 = 80%
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