-0. QUESTION SIX (15 MARKS) On February 1, 2020, Wild Horse Contractors (WHC) agreed to construct a building at a contract price of $3,060,000. WHC is a public company and it has a December 31" year end. The total estimated construction costs would be $1,895,000 and the project would be finished in 2022. Information relating to the costs and billings for this contract is as follows: 2020 2021 2022 Total costs incurred to date $ 663,250 $1,146,750 $2,295,000 Estimated costs to complete 1,231,750 938,250 Customer billings to date 1,100,000 1,895,000 3,060,000 Collections to date 1,000,000 1,750,000 2,950,000 (a) Calculate the gross profit/(loss) that should be recognized for 2020 and 2021 using the percentage completion method 2020 663 250/1895 000 = 0.35/1, Complete = 0.255/1 Jongere (0.35)(3060 000) (0.232 (3 060 000) Revenue=1071000 Revene = 709920. Cost Cost = 663 250 483700 Prorrit - 797 244.06 Proffit=407 750, 202 483600/2 085 000 - Page 9/10 a + 87 fall 2016.pdf doc (1).pdf HR-QUIZ-T8-10.pdf Chapter 7.pdf MacBook Air 80 F3 888 74 go PY DD FS DI PR ! A $ 4 % 5 @ 0 > & 7 3 6 00 8 9 0 Viti As WI S NW Ch. E tec Ech Ech ch WI! WMX m/#inbox/FMfegzGIZGCFmrbpRRrik Walbsp?projector-18message Partid:0.1 Introduction to Pe EC290 Textbook EC295 EC281 BU225 Assignment 1 pers Midterm 2 B0283 2 709920 (b) Provide all journal entries that should be made by WHC relating to its contract to construct a building for 2021 using the percentage completion method. Accounts receivable Contract ASSCH / ligbility Contract Asal lebilit Contract revenue 780760.06 Cash 709920- 780744.06 750 000 Accounts recevable Contrect Assert liability Cost of project 760 000 2 483 500 483 600 1.5 Project expense 483 600 Contract Asset / liability 483 600 Page (c) Assume instead that the 8 in 2021 were $1,938.250. Briefly discuss how much pro 10/10 reco the contract in 2021 using the nercentage completion method. Thesyo nyumal entries for this part, but BU387 tall 2016.... doc.pdf QUIZ-TB-10 odt Chapter 7.pal MacBook Air 80 888 ha FS 00 FY Del FB DD : $ 3 % 5 4 0 > & 7 3 6 00 8 9 0 Viti As WI S NW Ch. E tec Ech Ech ch WI! WMX m/#inbox/FMfegzGIZGCFmrbpRRrik Walbsp?projector-18message Partid:0.1 Introduction to Pe EC290 Textbook EC295 EC281 BU225 Assignment 1 pers Midterm 2 B0283 2 709920 (b) Provide all journal entries that should be made by WHC relating to its contract to construct a building for 2021 using the percentage completion method. Accounts receivable Contract ASSCH / ligbility Contract Asal lebilit Contract revenue 780760.06 Cash 709920- 780744.06 750 000 Accounts recevable Contrect Assert liability Cost of project 760 000 2 483 500 483 600 1.5 Project expense 483 600 Contract Asset / liability 483 600 Page (c) Assume instead that the 8 in 2021 were $1,938.250. Briefly discuss how much pro 10/10 reco the contract in 2021 using the nercentage completion method. Thesyo nyumal entries for this part, but BU387 tall 2016.... doc.pdf QUIZ-TB-10 odt Chapter 7.pal MacBook Air 80 888 ha FS 00 FY Del FB DD : $ 3 % 5 4 0 >
