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Prepare contract accounts in a column form for J. Mutenga Construction Company Ltd which at present has two contracts in progress using the following information:

Contract Number A B

$ $

Materials obtained from the store 16,000 21,000

Materials transferred to J. Mutenga 5,500 4,500

Wages 52,000 26,000

Direct expenses 10,000 12,000

Purchase of plant 250,000 85,000

Overhead costs 2,500 3,500

Materials on site on December 31 2,500 7,000

Materials returned back to the store 500 800

Accrued wages 5,500 2,500

Value of work certified 150,000 100,000

Work completed but not certified 30,000 20,000

Additional Information

a. Head office charges; 50,000 are charged to contracts in proportion to their prime costs

b. Additional office charges of 20,000 are charged to the contracts based on a ratio of 3:2.

c. Plant was installed at the commencement of the contract and depreciation charged was 10% per annum. Both contracts have been estimated to give an overall profit on completion. (32 marks)

QUESTION 12 Wages Prepare contract accounts in a column form for J. Mutenga Construction Company Ltd which at present has two contracts in progress using the following information: Contract Number B S s Materials obtained from the store 16,000 21,000 Materials transferred to J. Mutenga 5,500 4,500 52,000 26,000 Direct expenses 10,000 12,000 Purchase of plant 250,000 85,000 Overhead costs 2,500 3,500 Materials on site on December 31 2,500 7,000 Materials returned back to the store 500 800 Accrued wages 5,500 2,500 Value of work certified 150,000 100,000 Work completed but not certified 30,000 20,000 Additional Information a. Head office charges; 50,000 are charged to contracts in proportion to their prime costs b. Additional office charges of 20,000 are charged to the contracts based on a ratio of 3:2. C. Plant was installed at the commencement of the contract and depreciation charged was 10% per annum. Both contracts have been estimated to give an overall profit on completion. (32 marks)

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