Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in 2021 and was completed in 2022. Data relating to the contract are summarized below: Costs incurred during the year Estinated costs to complete as of 12/31 Cash collections during the year 2021 2022 $ 300,000 $1,575,000 1,200,000 380,000 1,620,000 250,000 1,750,000 Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time according to percentage of completion 2. Compute the amount of revenue and gross profit or lost to be recognized in 2021 and 2022 assuming this project does not qualify 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming Nortet recognizes revenue over time according to percentage of completion 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming this project does not qualify for revenue recognition over time. Required 1 Required 2 Required 3 Required 4 Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue o according to percentage of completion. (Use percentages as calculated and rounded in the table below to arrive at your final answe should be indicated with a minus sign.) Percentages of completion Choose numerator Choose denominator % complete to date 3 3 2021 X = x = 2022 O o 2021 To date Recognized in prior years Recognized in 2021 s 0 Construction revenue Construction expense Gross profit (loss) $ 0 0 2022 Recognized in prior years To dato Recognized in 2022 Construction revenue Construction expense Gross profit (0) s $ o 0 0 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 qualify for revenue recognition over time. (Loss amounts should be indicated with a minuss Revenue Gross Profit (Loss) 2021 2022 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare a partial balance sheet to show how the information related to this contract would be pre assuming Nortel recognizes revenue over time according to percentage of completion. Balance Sheet (Partial) At December 31, 2021 Current assets: x Current liabilities: Required 1 Required 2 Required 3 Required 4 Prepare a partial balance sheet to show how the information related to this contract would assuming this project does not qualify for revenue recognition over time. Balance Sheet (Partial) At December 31, 2021 Current assets: Current liabilities: X
