lakshay (ipcc) (581 Points)
10 April 2011i am really confused in estimated profit.
suppose we have to prepare contract ac for 07 ..n estimated pft is also given for 08
nw in 07 in contract ac its mat issued say 20000 and right side mat sold 5000 and mat at site 4000 (assumed)
then while preparing estimated contacr ac for 08
what shud be the mat value
ek to 08 mein jo mat issue kiya hain..+ 20000-5000-4000???
or 08 mat issue + 20000-5000
in icai its given 20000-5000
bt why so ...mat at site bi to minus hona chaiyeh??
The reason material at site of 2007 is not considered because material at site of 2007 (which is the closing balance of 2007) becomes the openning balance of 2008 and material issued for the year 2008 includes the opening balance. At the right side of the account we only keep what is left i.e material at site but material at site of 2007 is now included in 2008 and it is issued therfore when you prepare estimated account you only considere material at site of 2008. That is why Rs.4000 which is the material at site of 2007 is not deducted because had it been deducted then Rs.4000 would become closing balance (or material at site) but Rs.4000 is already issued as it is included in issue value of 2008 and it is no more a closing balance.
Here you are calculating estimated profit and preparing contract account from the beginning till the end of the contract.
lakshay
(ipcc)
(581 Points)
Replied 10 April 2011
bt in question its nt mentioned that cls stock of mat at site of o7 is included in mat issed for 08
mat 08 ka to naya issue kiya hoga na..hw can we say that 07 mat at site is inlcuded in 08 issue
Jayesh
(Article)
(21 Points)
Replied 11 April 2011
CAclubindia
