Attributable profit is the portion of the total estimated profit from a long-term contract, reflecting the fair share of work completed, minus estimated remedial, maintenance, and other non-recoverable costs at a specific accounting date.
Contract cost refers to the total cost incurred in fulfilling a long-term contract, typically calculated using contract costing techniques.
A long-term contract spans multiple accounting periods and involves the design, manufacture, or construction of significant assets, such as in construction or civil engineering industries. Proper accounting measures must be taken to allocate reasonable profit to each period.
