Book Pint Werences Citation Builders, Incorporated, builds office buildings and single-family homes. The office buildings are constructed under contract with reputable buyers. The homes are constructed in developments ranging from 10-20 homes and are typically sold during construction or soon after. To secure the home upon completion, buyers must pay a deposit of 10% of the price of the home with the remaining balance due upon completion of the house and transfer of title. Failure to pay the full amount results in forfeiture of the down payment. Occasionally, homes remain unsold for as long as three months after construction. In these situations, sales price reductions are used to promote the sale. During 2024, Citation began construction of an office building for Altemont Corporation. The total contract price is $15 million. Costs ncurred, estimated costs to complete at year-end, billings, and cash collections for the life of the contract are as follows: Costs incurred during the year 2024 $3,000,000 2025 $ 7,125,000 20261 $3,375,000 9,000,000 1,500,000 1,350,000 3,375,000 7,590,999 6,950,000 Estimated costs to complete as of year-end Billings during the year Cash collections during the year 6,000,000 7,600,000 Also during 2024, Citation began a development consisting of 12 identical homes. Citation estimated that each home will sell for $720,000, but individual sales prices are negotiated with buyers. Deposits were received for eight of the homes, three of which were completed during 2024 and paid for in full for $720,000 each by the buyers. The completed homes cost $540,000 each to construct The construction costs incurred during 2024 for the nine uncompleted homes totaled $3,240,000. Required: 1. Which method is most equivalent to recognizing revenue at the point of delivery? 2. Answer the following questions, assuming that Citation concludes it does not qualify for revenue recognition over time for its office building contracts: 2-a. How much revenue related to this contract will Citation report in its 2024 and 2025 income statements? 2-b. What is the amount of gross profit or loss to be recognized for the Altamont contract during 2024 and 2025? 2-c. What will Citation report in its December 31, 2024, balance sheet related to this contract? (Ignore cash) 3. Answer the following questions assuming that Citation recognizes revenue over time according to percentage of completion for its office building contracts. 3-a. How much revenue related to this contract will Citation report in its 2024 and 2025 income statements? 3-b. What is the amount of gross profit or loss to be recognized for the Altamont contract during 2024 and 2025? 3-c. What will Citation report in its December 31, 2024, balance sheet related to this contract? (ignore cash.) 4. Assume the some Information for 2024 and 2025, but that as of year-end 2025 the estimated cost to complete the office building is $6.750.000 Citation recognizes revenue over time according to percentage of completion for its office building contracts. 4-a. How much revenue related to this contract will Citation report in the 2025 income statement? 4-b. What is the amount of gross profit or loss to be recognized for the Altamont contract during 20257 4-c. What will Citation report in its 2025 balance sheet related to this contract? (Ignore cash.) 5. Which method of accounting should Citation Builders, Incorporated adopt for its single-family houses? 6. What will Citation report in its 2024 income statement and 2024 balance sheet related to the single-family home business (ignore cash in the balance sheet)? Req 1 2A and 2B Req 2C Req 3A and Req 3C Req 4A 38 48 Req 4C Req 5 Req 6A Req 6B What will Citation report in its December 31, 2024, balance sheet related to this contract? (Ignore cash.) Balance Sheet (Partial) At December 31, 2024 Current assets: Accounts payable Billings in excess of CIP Current liabilities: $ 150,000 2,250,000 Req 3A and 3B Req 4A and 48 > 6 Complete this question by entering your answers in the tabs below. Req 1 2A and oints 2B Req 2C Req 3A and 38 Req 3C Req 4A and 48 Req 4C Req 5 Req 6A Req 68 What will Citation report in its 2025 balance sheet related to this contract? (Ignore cash.) Balance Sheet (Partial) At December 31, 2025 Current assets: Accounts payable Current liabilities: Billings in excess of CIP 1,600,000 $750,000 Req 4A and 48 Req 5 > Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Req 1 2A and 28 Req 2C Req 3A and 38 Req 3C Req 4A and 48 Req 4C Req 5 Req 6A Req 68 What will Citation report in its 2024 Income statement related to the single-family home business? Income Statement (Partial) Sales revenue Cost of goods sold Gross profit 2024 $1,800,000 1,350,000 $450,000 9 Complete this question by entering your answers in the tabs below. nts Req 1 2A and 28 Req 2C Req 3A and 38 Req 3C Req 4A and 4B Req 4C Rec 5 Req 6A Req 68 What will Citation report in its 2024 balance sheet related to the single-family home business? Balance Sheet (Partial) At December 31, 2024 Current assets: Inventory (work in process) $2,700,000 Current liabilities Customer deposits (or deferred revenue) $300,000 Req SA