information given to us:
- The Architect was hired to create drawings to construct a building
- The Contractor says the drawings were defective
- The Owner failed to make sure fixtures and equipment for the building were delivered on time
- The Contractor was the winning bidder in a competitive bid process
- The Contractor now wants $1,000,000 additional compensation to cover the related cost overruns
My task is:
We have been hired as consultants by the attorneys representing the Owners to assess the Contractor’s claims to see if they have any merit. In order to come to an informed conclusion, we must consider specific information pertaining to the situation:
- What is the Architect’s Transaction Price and how it is Allocated to the Performance Obligations ?
AdityaBhandakkar
Hi, In the present scenario, most of the owners spending between 2000$ to 5000$ to har and architect. Well, this is only based upon a project and other services. Sum of an architect charge 8% to 15% of the overall project cost but it depends upon the services, size and type of project. allocating the performance of applications is an entity to determine the contractor selling price for distinct goods and various services. It is according to the rules of FASB and IASB.
Hope you understood.
Komal Bhandakkar
Allocating the transaction price to the performance application in a contract with a customer is essential for revenue recognition.
First of all, identification of the performance of obligations in the contract and determination of a transaction price is beneficial for reaching the entities
Transaction price also reflects the consideration of the entity except to receive was it meets the performance of applications in the contract.
Actually, allocation of the the transaction price is done totally based on the performance of applications in the contract.
The overall objective of allocating the transaction price is to arrive at an allocation that represents the amount of considering the entity.