PAYMENT CERTIFICATE

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manohar (Querist)
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07 December 2010 DEAR SIR
I RECEIVED FROM ONE CUSTOMER ONE P.C AS FALLOWS.

TOTAL CONTRACT VALUE 7,000,000/-

WORK DONE 517,285/-
MATERIAL ON SITE 890,000/-
TOTAL VALUATION (517,285+890,000) 1,407,285/-

WORK DONE RETAINED (10%) 51,728.5/-
MATERIAL (25%) 222,500/-
ADV PAY DEDUCT 351,821.25

NET PAYMENT 781,235.25

PLEASE GIVE ME THE JOURNAL ENTRY AND HOW TO POST THIS ENTRY IN QUICKBOOKS SOFTWARE AND WHY THEY ARE TAKEN MAT. ON SITE FOR VALUATION(ACCRUAL BASIS)
PLEASE HELP ME

Prakash

Prakash (Expert)
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08 December 2010 It is an contractual payment certficate.
Payment will be done according to payment terms of agreement.
In this case payment will be released as 90 % on progreesive invoice(work done) and 10% will be retained.

And payment also will be relased for material procurement on site 75% of valution amount and 25%will be retianed.

So, entry is as follows.

Dr Bank a/c 781235.25
Dr Retention - Material on site (25%) 222500.00
Dr Retention - Progress payment (10%) 51728.50
Dr Advance payment deduction 351821.25
Cr Clients A/c - Advance against Material on site 890000.00
Cr Clients A/c - Progress for the period (Work done) 517285.00

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Hitender Gaur

Hitender Gaur (Expert)
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08 December 2010 I have no knowledge about QB Soft. in tally entry will be as follow,

Work Done by P/c. A/c Dr. 5,17,285
Advance Ag. Material A/c Dr. 8,90,000
To Work Done Retained A/c. 51,729.15
To Advance Ag.Material A/c. 2,22,500
To Advance Paid to P/c A/c3,51,821.25
To P.C. A/c. 7,81,235.25

When you are Dr. MAterial at site it means you are giving advance to P.C. against the material precured by him at site. when you are Cr. material at site You are recovering adance paid to PC against MAterial at site. Work Done retained is Security of PC which is deposited with you.

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