Chapter 5 Homework Che 7 Exercise 6-22 (Algo) Long-term contract, revenue recognition upon project completion; loss projected on entire project [LO6-8, 6-9) 3 points 0227 Skiped On February 1, 2021. Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8.225.000. During 2021, costs of $2,090,000 were incurred with estimated costs of $4,090,000 yet to be incurred. Billings of $2608,000 were sent, and cash collected was $2.340,000 In 2022, costs incurred were $2,608,000 with remaining costs estimated to be $3.735,000.2022 billings were $2,858,000, and $2.565,000 cash was collected. The project was completed in 2023 after additional costs of $3,890,000 were incurred. The company's fiscal year-end is December 31 This project does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years, 2a. Prepare journal entries for 2021 to record the transactions described (credit various accounts for construction costs incurred). 2b. Prepare journal entries for 2022 to record the transactions described (credit 'various accounts for construction costs incurred). 3. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2021. 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022 Complete this question by entering your answers in the tabs below. References Rega RG2A Rea 20 Reg 3 Calculate the amount of revenue and gross profit or loss to be recognised in each of the three years. (loss amounts should be indicated with a minusson) Year Rwvenue Gross profilo recognized recognized 2001 2022 Total $ 0 7. 3 Dots In 2022, costs incurred were $2,608,000 with remaining costs estimated to be $3,735,000.2022 billings were $2,858,000, and $2,565,000 cash was collected. The project was completed in 2023 after additional costs of $3,890.000 were incurred. The company's fiscal year-end is December 31. This project does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years. 2a. Prepare journal entries for 2021 to record the transactions described (credit various accounts for construction costs incurred), 2b. Prepare journal entries for 2022 to record the transactions described (credit various accounts for construction costs incurred) 30. Prepare a partial balance sheet to show the presentation of the project as of December 31 2021 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022 0229.07 Skippe Complete this question by entering your answers in the tabs below. ok Red Reg 2 Reg 20 REGA Reg38 Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022. (Do not round intermediate calculations. Round your answers to the nearest dollar amount. Balance Sheet Al December 31, 2022 Current References Current
