Construction Knowledge Center
Explore our verified library of Construction transactions. Every entry is reviewed for IFRS compliance and real-world accuracy by our technical accounting team.
Recording Retention Money in Construction
How to account for the percentage of payment withheld by a client until project completion.
Applying Manufacturing Overhead
Allocating indirect production costs to Work-in-Process (WIP) based on a predetermined rate.
Sale of Manufacturing Scrap Metal
Recording the miscellaneous income from selling byproduct or waste materials from production.
Transferring WIP to Finished Goods
Recording the completion of production and moving costs from Work-in-Process to Finished Goods inventory.
Sale of Construction Site Scrap
Recording revenue from selling excess rebar or copper scrap from a job site.
Project Mobilization Advance
Receiving an upfront payment from a client to start a construction project.
Capitalizing Interest on Construction Loan
Adding the interest cost of a project loan to the cost of the building being constructed (IAS 23).
Purchase Price Variance (PPV)
Recording the difference between the standard cost of a material and the actual price paid.
Retention Payable to Subcontractor
Withholding a percentage of a subcontractor's payment as a guarantee for their work quality.
Capitalizing Interest on Project Loans
Adding interest costs to the value of a 'qualifying asset' during its construction period (IAS 23).
Provision for Onerous Contract (Expected Loss)
Recording an immediate loss when it becomes clear that the cost of a construction project will exceed the revenue.
Performance Bond Insurance Premium
Paying for a bond that guarantees the client that the project will be completed.
Contract Change Order (Increased Scope)
Adjusting the contract value and revenue when a client requests additional work mid-project.
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