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Intermediate Accounting
Hamilton Construction Company uses the percentage-of-completion method of accounting. In

Hamilton Construction Company uses the percentage-of-completion method of accounting. In 2020, Hamilton began work under a non-cancellable

Question:

Hamilton Construction Company uses the percentage-of-completion method of accounting. In 2020, Hamilton began work under a non-cancellable contract #E2-D2, which provided for a contract price of $2.2 million. Other details follow:

Instructions

a. How much revenue should be recognized in 2020? In 2021?

b. Assuming the same facts as those above except that Hamilton uses the completed-contract method of accounting, how much revenue should be recognized in 2021?

c. Prepare a complete set of journal entries for 2020 (using the percentage-of-completion method).

Transcribed Image Text:

2021 2020 Costs incurred during the year Estimated costs to complete, as at December 31 Billings during the year (non-refundable) Collections during the year $1,425,000 $640,000 960,000 420,000 350,000 -0- 1,680,000 1,500,000

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a 2020 640000 X 2200000 880000 640000 960000 2021 2200000 contract price minus 880000 rev...View the full answer

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Intermediate Accounting Volume 1

ISBN: 978-1119496496

12th Canadian edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy

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Question Posted: Nov 29, 2019 09:41 AM

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