Wynne Construction Limited currently has two large scale projects in progress. It has been commissioned by the Department of Education and Skills to construct an education campus in South Tipperary. The 50m contract with a 10% retention rate, commenced on 1* January 2014 and its anticipated completion date is 1" December 2017. Last year Wynne Construction Ltd won a contract valued at 100m for the pharmaceutical giant Berry plc, to build a new research and development facility, including road infrastructure upgrade in Athlone. Construction commenced on 1" July 2015 and is anticipated to be complete by December 2019. The retention rate on this contract is 20%. The company prepares its accounts to 30h June cach year. The following details have been extracted in relation to these two contracts: Education R&D Facility Campus '000 10,000 *000 Plant sent to site at beginning of project Nate At July 2015 15,000 Accumulated cost of work certified to date 10,000 Materials on hand 1,000 500 Accrued wages and salaries Transactions during the year Materials sent to site Wages and salaries Production overhead 11,000 4,000 3,000 10,000 2,000 1,500 At 30 June 2016 Materials on site Accrued wages and salaries Accumulated value of work certified Cost of work not certified Estimated costs to complete 2,000 500 6,000 1,000 Nete 2 37,000 4,000 13,000 58,000 Additional Information Note 1: Depreciation is charged on plant using the straight-line method of depreciation at 10% per annum. Note 2: Surveyors report not yet available. Note 3: Stage payments have been received from the Berry ple equal to the value of work certified less the contracted retention. Requirement: (a) Write a note to Wynne Construction Limited outlining the factors to be considered in determining the attributable profit or loss of a contract which, in compliance with accounting regulations, can be recognised in a financial year. 5 Marks (b) Show the contract accounts for cach project for the year ended 30* June 2016. 8 Marks (e) Compute the profit or loss and attributable sales revenue to be recognised on each contract. 7 Marks