Deck 8: Contractor Payments and Profit Calculation

Question 1

The cost of work that has been done by the contractor on the closing date of account, but has not reach stipulated stages to qualify certification of architect of contractee

A)Work certified
B)Work uncertified
C)Contract price
D)None of these

Answer 1

Work uncertified

Question 2

Retention money is retained by whom ………………….

A)Contractor
B)Contractee
C)Both a and b
D)None of these

Answer 2

Contractee

Question 3

If the value of work certified less than 25% of contract price,profit to be credited to P&L is

A)No profit is credited to P & L a/c
B)1/3 of national profit credited to P & L a/c
C)2/3 of national profit credited to P & L a/c
D)None of these

Answer 3

No profit is credited to P & L a/c

Question 4

In which situation, 2/3 of national profit credited to P & L a/c

A)If the value of work certified equal to or more than 90% of the contract price
B)If the value of work certified less than 25% of the contract price
C)Both a and b
D)If the value of work certified equal to or more than 50% but less than 90% of the contract price

Question 5

If the value of work certified equal to or more than 90% of contract price, profit to be credited is……………….

A)2/3 * National profit * (Cash received/Work certified)
B)No profit credited to P&L a/c
C)Estimated profit on completion*(Work certified/Contract price)
D)1/3 * National profit * (Cash received/Work certified)

Question 6

Example for cost plus contract

A)Construction work in war
B)Manufacture of ship in special type or design
C)Construction of fish tank
D)Both a and b

Question 7

The expenses incurred in extra work is

A)Debited in contract amount
B)Credited in contract amount
C)Not shown in contract amount
D)None of the above