dear all,
suppose, a person acquires land from the land owner..constructs 20 flats.out of which 8 flats are to be given to land owner in consideration..now..how the revenue should be recognised in this case:
in the very first year of the business;
amount received from booiking : 2,00,00,000
expenditure incurred : 1,80,00,000
The amount to be recognised a s revenue is based on the percentage of completion as on 31.3 ie end of the accounting year.
The completion certificate to be obtained from the Architect to ensure the percentage of comletion as per AS 7 of the accounting standared of ICAI.
The land cost can be taken to the UDS cost to be apportioned to the number of allottees .
The land cost and construction cost is the rate per sq ft for selling he apartment.
So hope the matter is clear to you. As I am from the construction industry I hope you have got the required clarification.
Regards,
CA Viswanathan C P
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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