On February 1, 2024. Arrow Construction Company entered into a three-year construction contract to build a...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
On February 1, 2024. Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,300,000. During 2024, costs of $2,100,000 were incurred with estimated costs of $4,100,000 yet to be incurred. Billings of $2,600,000 were sent, and cash collected was $2,350,000. In 2025, costs incurred were $2,600,000 with remaining costs estimated to be $3,750,000. 2025 billings were $2,850,000, and $2,575,000 cash was collected. The project was completed in 2026 after additional costs of $3,900,000 were incurred. The company's fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion. Required: 1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years. 20. Prepare journal entries for 2024 to record the transactions described (credit "Cash, Materials, etc." for construction costs incurred). 2b. Prepare journal entries for 2025 to record the transactions described (credit "Cash, Materials, etc." for construction costs incurred). 30. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2024. 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2025. On February 1, 2024. Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,300,000. During 2024, costs of $2,100,000 were incurred with estimated costs of $4,100,000 yet to be incurred. Billings of $2,600,000 were sent, and cash collected was $2,350,000. In 2025, costs incurred were $2,600,000 with remaining costs estimated to be $3,750,000. 2025 billings were $2,850,000, and $2,575,000 cash was collected. The project was completed in 2026 after additional costs of $3,900,000 were incurred. The company's fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion. Required: 1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years. 20. Prepare journal entries for 2024 to record the transactions described (credit "Cash, Materials, etc." for construction costs incurred). 2b. Prepare journal entries for 2025 to record the transactions described (credit "Cash, Materials, etc." for construction costs incurred). 30. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2024. 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2025.
Expert Answer:
Answer rating: 100% (QA)
1 Calculation of Revenue and Gross Profit or Loss Year 2024 Revenue Recognized Total Contract Price Costs Incurred Total Estimated Costs Revenue Recog... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
Jim Company acquired a 100% of the common stock of John Company on January 1, 2024. John Company maintains separate incorporation. Immediately following the acquisition, Jim and John had the...
-
Complete the Statement in proper form Revenue will be provided in an Announcement at the end of Module 4 (based on actual number of services for your pricing levels) Additional Information necessary...
-
In 2021, Kevin had total sales of $160,000, of which $65,000 were on account. On December 31, 2021, there are receivables of $42,000. He estimates that $4,000 of these receivables are doubtful of...
-
Dakota Company purchased several assets from a competitor, paying a lump-sum of $1,000,000 (one million dollars). The assets included: i. Land - valued at $420,000 ii. Building - valued at $400,000...
-
1. If an ore isn't radioactive, then it isn't pitchblende. 2. All but the rats left the sinking ship. 3. A pesticide is dangerous if it contains DDT. 4. John Grisham writes only novels about lawyers....
-
Why do certain professionals bankers, accountants, lawyers, physicians, clergy have fiduciary responsibilities?
-
The consistent mass matrix of a bar element is given by a. \(\frac{ho A l}{6}\left[\begin{array}{ll}2 & 1 \\ 1 & 2\end{array} ight]\) b. \(\frac{ho A l}{6}\left[\begin{array}{rr}2 & -1 \\ -1 &...
-
Heyer Appliances assembles dishwashers at its plant in Tuscaloosa, Alabama. In February 2014, 60 circulation motors that cost $ 110 each (from a new supplier who subsequently went bankrupt) were...
-
Go into depth about the topic: Do women in the workplace still have to tolerate sexual harassment to advance or maintain their job positions? Why or why not? THE SCENARIO: You are human resource...
-
The production manager at a factory manufacturing four types of light fittings (A, B, C and D) on an automated machine is fixing the schedule for the next week on this machine. HEIJUNKA SCHEDULING OF...
-
Produce a diagram to illustrate how the amino group of amino acids found in the body is excreted. ii. Discuss the diagnostic significance of an elevated/decreased BUN level.
-
What are the principal sources of government revenues in developing countries? Why are many taxes so difficult to collect? Discuss.
-
Summarize the arguments for and against the establishment of state-owned enterprises (SOEs) in developing nations. Do you think that SOEs should be encouraged or discouraged? What are the arguments...
-
What are the links among educational systems, labor markets, and employment determination in many developing countries? Describe the process of educational job displacement.
-
A married man (born 3 November 1934) died on 8 July 2020. He received a retirement pension of 14,930 between 6 April 2020 and the date of his death. His wife (born 12 August 1940) had no income...
-
Given the following code snippet, what statement about the values printed on lines q1 and q2 is correct? A. They are always the same. B. They are sometimes the same. C. They are never the same. D....
-
A uniform charged sphere of radius a and carrying the charge density and spinning at a constant angular velocity about z-axis. The current density at any point (r.0.) inside the sphere is given by O...
-
Design an experiment to demonstrate that RNA transcripts are synthesized in the nucleus of eukaryotes and are subsequently transported to the cytoplasm.
-
On January 1, 2024, a company adopted the dollar-value LIFO method for its one inventory pool. The pools value on this date was $660,000. The 2024 and 2025 ending inventory valued at year-end costs...
-
On January 1, 2024, Ravetch Corporations projected benefit obligation was $30 million. During 2024, pension benefits paid by the trustee were $4 million. Service cost for 2024 is $12 million. Pension...
-
Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2024, Lacy received the following information: The expected long-term rate of return on plan assets was 10%....
-
_____________ is also used as requirement finding and feasibility testing tool. (a) Prototype (b) Reports (c) System (d) Procedure
-
A prototype can be ___________. (a) Complete system with partial requirements (b) Working model (c) Full-fledged system (d) All of these
-
Which of the following systems development approach is adopted if information requirements are not well defined? (a) SDLC (b) Prototype (c) Structured approach (d) Agile
Study smarter with the SolutionInn App