Question
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,890,000. The project was begun in 2017 and
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,890,000. The project was begun in 2017 and completed in 2018. Cost and other data are presented below:
| 2017 | 2018 | |||||
| Costs incurred during the year | $ | 423,000 | $ | 1,190,000 | ||
| Estimated costs to complete | 987,000 | 0 | ||||
| Billings during the year | 445,000 | 1,445,000 | ||||
| Cash collections during the year | 345,000 | 1,545,000 | ||||
Assume that Beavis recognizes revenue on this contract over time according to percentage of completion. Required: Compute the amount of gross profit recognized during 2017 and 2018.
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,890,000. The project was begun in 2017 and completed in 2018. Cost and other data are presented below:
| 2017 | 2018 | |||||
| Costs incurred during the year | $ | 423,000 | $ | 1,190,000 | ||
| Estimated costs to complete | 987,000 | 0 | ||||
| Billings during the year | 445,000 | 1,445,000 | ||||
| Cash collections during the year | 345,000 | 1,545,000 | ||||
Assume that Beavis recognizes revenue on this contract over time according to percentage of completion. Required: Compute the amount of gross profit recognized during 2017 and 2018.
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Financial Accounting Reporting And Analysis
Authors: Earl K. Stice, James D. Stice
7th Edition
0324227329, 978-0324227321
