Accounting Treatment: Conditions For Confirmation Of The Provision Of Labor Services

On balance sheet date, the result of labor paction can not be reliably estimated.

If the result of the labor paction provided by the enterprise on the balance sheet date can not be reliably estimated, it shall be dealt with in the following situations as follows:

(1) what has happened

If it is expected that the compensation can be made, the labor income shall be recognized according to the amount of labor cost that has occurred, and the labor cost will be converted at the same amount.

(2) the labor cost that has occurred is expected to be partially compensated. It should be recognized as A in accordance with the amount of labor that can be compensated, and the labor cost will be converted according to the labor cost that has occurred.

(3) if the labor cost that has occurred is not expected to be compensated, the labor cost that has already occurred shall be included in the profits and losses of the current period, and the income from the provision of labor services shall not be recognized.

On the balance sheet date, the results of the labor paction can be reliably estimated.

If the results of the labor paction provided by the enterprise on the balance sheet date can be reliably estimated, the percentage of the completion percentage shall be used to confirm the provision of labor income.

The percentage completion method refers to the method of confirming the income and expenses according to the completion schedule of the labor service paction.

Whether the results of the paction can be reliably estimated depends on the following conditions.

The following conditions are met, indicating that the results of the provision of labour services can be reliably estimated:

(1) the amount of income can be measured reliably;

(2) the relevant economic interests are likely to flow into enterprises.

(3) the completion schedule of pactions can be determined reliably.

Enterprises determine the provision of labor services pactions

In general, the following methods can be chosen: the measured work completed, the proportion of labor provided to the total amount of labor provided, and the proportion of the cost that has occurred to the estimated total cost.

(4) the costs that have occurred and will be incurred in pactions can be measured reliably.

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Adjusted sales: refers to the adjustment of the fair value and the book value of the assets of the invested unit at the time of initial investment.

We can understand this, because when the investment enterprise obtains the investment, it confirms the initial confirmation amount of the long-term equity investment according to the fair value of the paid assets, and can adjust the initial recognition amount according to the share of the identifiable net assets, so it also calculates the investment profit according to the fair value, that is, adjusting the net profit realized by the invested enterprise according to the fair value of the assets.

If the invested enterprise sold part of the stock in that year, the invested enterprise did not carry the inventory cost according to the book value, and adjusted according to the fair value.

Since the fair value of stock is greater than the book value, the cost of carry over is greater than the cost carried by the book value. Therefore, when the investment enterprise recognizes the investment income, it should increase or decrease the difference on the basis of the net profit of the invested enterprise.

Adjusting the unsold: it means that after the investment of an investment enterprise, there is an internal paction with the invested enterprise. If the inventory is not sold externally, there will be an unrealized profit at the end of the term. When the investment enterprise recognizes the investment income, it needs to adjust the net profit of the invested entity and reduce the unrealized profit of the end part of the investment.

When there is still no external sale in the future, there is no need for adjustment, and when adjustment is realized, it is necessary to adjust and add back.