2023

Long-term contracts Revenue Recognition over Time (pages 18-36 through 18-46) Required: A. Compute the amount of gross profit to be recognized each year, assuming the percentage of completion method is used. [Format for gross profit schedule is provided.) B. Prepare all necessary journal entries for 2021, 2022, and 2023. [Format for journal entries provided.] C. Post all amounts to be entered into the 'Accounts Receivable', 'Construction in Process' and 'Billings on Construction in Process' accounts for all three years. ['T'account formats provided.) D. Prepare the closing entry for the contract. (Record with journal entries.) E. Show accounts and amounts that would appear in the Income Statement and Balance Sheet for 2022. [Formats for partial statements provided.) Practice Information: During 2021, Wilcox Company started a construction job with a contract price of $1,000,000. The job was completed in 2023. The following information is available $ $ Costs incurred to date Estimated costs to complete Billings to date Collections to date 2021 2022 280,000$ 320,000 420,000 320,000 350,000 550,000 250,000 500,000 2023 800,000 800,000 1,000,000 950,000 B. General Journal C. General Ledger Date Accounts Debit Credit Construction in Process Billings on Construction in Process 2021 2022 Accounts Receivable