Notional Profit – NBC Institute

MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

Question

: IJKL is a construction company with a contract which is 48% complete and the policy is to recognise three-quarters of notional profit. Value of work certified is N4,500,000, cash received from progress payment is N3,500,000, and the cost of work certified is N4,140,000. The contract sum of the project is N10,000,000.

What will be the profit taken?

A. N583,333

B. N385,000

C. N373,333

D. N210,000

E. N186,667

Answer

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Tags: Contract Costing, Notional Profit, Work certified
Level: Level 1

Topic: Costing Methods
Series: NOV 2020

MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

Question

Notional profit is:

A. Profit made by all companies in a nation
B. Profit estimated on an on-going contract at the end of a financial year
C. Profit earned from all branches of a business nationwide
D. Estimated profit on a job about to be commenced
E. Profit earned on a contract just concluded

Answer

Find Related Questions by Tags, levels, etc.

Tags: Contract Accounting, Job Costing, Notional Profit
Level: Level 1

Topic: Costing Methods
Series: MAY 2021

MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

Question

What will be the profit taken?

A. N583,333

B. N385,000

C. N373,333

D. N210,000

E. N186,667

Answer

Find Related Questions by Tags, levels, etc.

Tags: Contract Costing, Notional Profit, Work certified
Level: Level 1

Topic: Costing Methods
Series: NOV 2020

MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

Question

Notional profit is:

Answer

Find Related Questions by Tags, levels, etc.

Tags: Contract Accounting, Job Costing, Notional Profit
Level: Level 1

Topic: Costing Methods
Series: MAY 2021

Question Tag: Notional Profit

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MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

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MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

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MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

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MI – Nov 2020 – L1 – SA – Q8 – Costing Methods

Calculate the profit to be taken from a contract based on work certified and cost of work certified.

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MI – May 2021 – L1 – SA – Q5 – Costing Methods

Define notional profit in contract costing.

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