Chegg has taken down my last few questions after I post them, so I'm not totally sure what is allowed and what's not, but I really need help on this problem, so here goes.
Exercise 6-21 (Static) Long-term contract; revenue recognition over time; loss projected on entire project [LO6-9] On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,000,000. During 2021, costs of $2,000,000 were incurred with estimated costs of $4,000,000 yet to be incurred. Billings of $2,500,000 were sent, and cash collected was $2,250,000. In 2022, costs incurred were $2,500,000 with remaining costs estimated to be $3,600,000. 2022 billings were $2,750,000, and $2,475,000 cash was collected. The project was completed in 2023 after additional costs of $3,800,000 were incurred. The company's fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion. Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021, 2022, and 2023 using the percentage of completion method. 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). 3a. 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. Reg 1 Req 2A Req 2B Req Req 3B Compute the amount of revenue and gross profit or loss to be recognized in 2021, 2022, and 2023 using the percentage of completion method. (Do not round intermediate calculations. Loss amounts should be indicated with a minus sign. Round your final answers to the nearest whole dollar.) Percentages of completion Choose numerator Choose denominator % complete to date 2021 2022 2023 | 2021 To date Recognized in prior years Recognized in 2021 Construction revenue Construction expense expense Gross profit (loss) $ - 2022 To date Recognized in prior years Recognized in 2022 I Construction revenile r 2022 To date Recognized in prior years Recognized in 2022 Construction revenue Construction expense Gross profit (loss) $ 2023 To date Recognized in prior years Recognized in 2023 Construction revenue Construction expense Gross profit (loss) 2022 To date Recognized in prior years Recognized in 2022 Construction revenue Construction expense Gross profit (loss) $ 2023 To date Recognized in prior years Recognized in 2023 Construction revenue Construction expense Gross profit (loss) Journal entry worksheet 2 3 4 Record the construction costs. Note: Enter debits before credits. General Journal Debit Credit Year 2021 Record entry Clear entry View general journal Journal entry worksheet Reg 1 Req 2A Req 2B Req Req 3B 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 (Partial) At December 31, 2022 Current assets: Current liabilities:
