On January 1, 2014, the Kobe Construction Company entered into a three-year contract to build a dam.

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On January 1, 2014, the Kobe Construction Company entered into a three-year contract to build a dam. The original contract price was $21,000,000 and the estimated cost was $19,400,000. The following cost data relate to the construction period.

Prepare the required journal entries for the three years of the contract, assuming Kobe uses the completed-contract method.

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Intermediate Accounting

ISBN: 978-1133957911

19th edition

Authors: Earl K. Stice, James D. Stice

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Question Posted: Oct 05, 2016 08:06 AM

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On January 1, 2014, the Kobe Construction Company entered into a three-year contract to build a dam.

Question:

Cost Incurred Estimated Cost to Complete Cash Year Billings $1,200,000 6,500,000 7,300,000 Collected $1,200,000 ,700,000 7 7,900,000 $17,ǐ00,000 7014 2015 2016 $6;,00,000 6,400,000 8,100,000 7800,000 0

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2014 Construction in Progress 7200000 Materials Labor Cash etc 7200000 Accounts Receivable 7200000 P...View the full answer

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