Contract costing

Please help me in this question as i am lacking in it . please see to it  and try to give solution of it .

 

A contract for construction of building is governed by escalation clause in respect of prices of steel,

cement, and stone aggregate.The prices ruling on the date of tender for building and actual prices paid by the contractor  were  as follows:

                                                       On date of tender            actual      

 Steel per ton                              610                                          675

Cement p                                 100                                          105

Stone aggregate per 100 cft  40                                             38

3,00,000 c.ft. of reinforced  cement concrete was laid in the building.If 100lbs of steel , 2400lbs of cement  and 90c.ft. of stone are net quantity required to cast 100c.ft. of RCC  and wastage are 5,3 and 10 % respectively. Calculate the difference in selling price according to estimate clause (1 ton = 2,240 lbs).Assume the wastage % based on net quantity of material.

Replies (1)
Originally posted by : student
Please help me in this question as i am lacking in it . please see to it  and try to give solution of it .
A contract for construction of building is governed by escalation clause in respect of prices of steel,
cement, and stone aggregate.The prices ruling on the date of tender for building and actual prices paid by the contractor  were  as follows:
                                                       On date of tender            actual      
 Steel per ton                              610                                          675
Cement p                                 100                                          105
Stone aggregate per 100 cft  40                                             38
3,00,000 c.ft. of reinforced  cement concrete was laid in the building.If 100lbs of steel , 2400lbs of cement  and 90c.ft. of stone are net quantity required to cast 100c.ft. of RCC  and wastage are 5,3 and 10 % respectively. Calculate the difference in selling price according to estimate clause (1 ton = 2,240 lbs).Assume the wastage % based on net quantity of material.

Eg:-

1000 kg

+ 10% wastage ------> 12%

 = 1100 kg consumed
.
10% = normal wastage

12% = increased wastage

2% = extra wastage (abnormal wastage)
.
Note: Escalation claim is based on input of material

 [output + normal wastage (abnormal wastage not to be considered)]
.
Solution:-

Particulars

Steel

Cement

Stone

(Net Qty)

100 cft RCC

 

100 lbs

 

2400 lbs

 

90 cft

(Net Qty)

300000 cft RCC

 

300000 lbs

 

7200000 lbs

 

270000 cft

Gross Qty

+ 5% wastage

+3 % wastage

+ 10% wastage

300000 cft RCC

315000 lbs

7416000 lbs

297000 cft

 

/ 2240

/2240

 

 

= 140.625 tons

= 3310.71 tons

 

 

*65
(675-610) UP

*5

(105-100) UP

*0.02 (2/100)

(38-40) DOWN

 

=9140.625

=16553.55

=5940

9140.625+16553.55-5940 = 19754.175 (Escalation claim)

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
ARTICLESHIP 28 September 2026
Junior Accountant

J S P M & Associates LLP

Pune

B.Com

View Details
Company
04 September 2026
CA inter Or ca finalist

A Jaiswal and company

Lucknow

CA Final

View Details
Company
Featured 21 September 2026
Consultant - Reporting

Finrep Advisors LLP

Mumbai

CA

View Details
Company
20 September 2026
Semi Qualified CA

Navin & Associates

Mumbai

CA Inter

View Details
Company
ARTICLESHIP 04 September 2026
Accounts Executive

Hema Yashwanth & Associates

Chennai

B.Com

View Details
Company
22 September 2026
Account Assistant

Chirag P Shah & Co. Chartered Accountant

Pune

B.Com

View Details
Company
26 September 2026
Chartered Accountant

pushpganga ventures

Pune

CA

View Details
Company
Featured 12 September 2026
Assistant Manager - Finance & Compliance

Naveen Fintech Pvt Ltd

Kolkata

CA Inter

View Details