Accounting for Retention Receivable & Payable: A Contractor’s Guide
Levelset
JUNE 6, 2022
Retention can be withheld on residential or commercial projects and on both public and private projects. ABC Contractor is billing a project owner for $100,000 with 10% retention. When the $90,000 is paid, it is posted with a debit to the bank or cash account and a credit to accounts receivable, clearing the account for that project.
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