(Recognition of Profit on Long-Term Contracts) During 2007 Pierson Company started a con- 4) struction job with...
Question:
(Recognition of Profit on Long-Term Contracts) During 2007 Pierson Company started a con-
4) struction job with a contract price of $1,500,000. The job was completed in 2009. The following information is available.
Instructions
(a) Compute the amount of gross profit to be recognized each year assuming the percentage-ofcompletion method is used.
(b) Prepare all necessary journal entries for 2008.
(c) Compute the amount of gross profit to be recognized each year assuming the completed-contract method is used.
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Related Book For
Intermediate Accounting 2007 FASB Update Volume 2
ISBN: 9780470128763
12th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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