PDF · As 7
AS 7 Construction Contracts: Solved Questions for CA Inter Advanced Accounting
- Shared by
- Kavyansh
- Course
- CA Inter
- Subject
- Advanced Accounting
- Added
- 1 Nov 2026
Part of: CA InterAdv Accounting
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These notes work through solved questions on Accounting Standard 7, Construction Contracts, from the CA Inter Advanced Accounting syllabus. The first pages cover when a contract with several assets is treated as separate contracts, how revenue and cost are recognised using the percentage of completion method, and how foreseeable losses are provided for. They suit students preparing for CA Inter exams who want to practise AS 7 numericals step by step.
What the notes cover
The notes explain the conditions under which a single agreement covering several outlets or assets is treated as separate construction contracts. They then solve problems on computing the degree of completion from cost incurred and estimated total cost, recognising revenue on that basis, and charging full foreseeable losses to the profit and loss statement at once. Later questions cover contract work in progress, the amount due from or to customers at year end, and the disclosures required under AS 7.
How to use them for revision
Work through each question with the answer hidden, then compare your workings line by line. The repeated pattern of computing percentage of completion and then applying it to the contract price is useful to memorise. Pay attention to the layout of the amount due from or to customers, since it is a common format question in exams. Redo the same concept with different figures to build speed.
Who should read them
These notes are most useful for CA Inter students of Advanced Accounting who are covering the AS 7 chapter and want exam-style practice. Students revising for the MTP and RTP style questions on construction contracts will find the solved sums directly relevant to their preparation.
Key topics in these notes
- Combining and segmenting construction contracts
- Percentage of completion method
- Recognition of revenue and costs under AS 7
- Foreseeable losses on construction contracts
- Contract work in progress
- Amount due from or to customers
- Disclosures under AS 7 (Revised)
- as 7
- construction contracts
- ca inter
- advanced accounting
- percentage of completion
- contract accounting
- ca inter solved questions
Related notes
Frequently asked questions
When is a contract with several assets treated as separate contracts under AS 7?
Each asset is treated as a separate construction contract when separate proposals are submitted, each asset is separately negotiated, and the costs and revenues of each asset can be identified.
How is revenue calculated under the percentage of completion method in these questions?
Revenue is found by taking the cost incurred to date as a percentage of total estimated cost of construction, then applying that percentage to the total contract price.
How is a foreseeable loss treated under AS 7?
When total contract costs are expected to exceed total contract revenue, the full expected loss is recognised as an expense immediately.
Do these notes include the full set of questions?
The preview shows the first 4 of 11 pages. Open it free in the Studycaller app to read the full note.