On April 15, 2014, construction bids were opened and analyzed. A bid of $2,000,000 was accepted,...
Question:
On April 15, 2014, construction bids were opened and analyzed. A bid of $2,000,000 was accepted, and the contract was awarded for the Elm Street Project. The contract provided for a retained percent age of 4 percent from each progress payment, and from the final payment, until final inspection and acceptance by the city's public works inspectors.
Required: Record the signing of the contract in the general journal of the Street Improvement Fund general journal. This transaction has no effect at the government-wide level.
Contract:
A contract is written or spoken agreement, especially one concerning employment, sales, or tenancy, that is enforceable by law. A valid contract requires consideration.
Answer and Explanation: 1
Journal Entry:
| Particulars | Debit $ | Credit $ |
|---|---|---|
| Elm Street Project | $2,000,000 | |
| Outstanding-Elm Street Project | $2,000,000 | |
| (Being the signing of contract been recorded) |
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