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Clorad Corp. contracts with a customer to construct a building. It appropriately determines that it has one performance obligation which is satisfied over time. Using
Clorad Corp. contracts with a customer to construct a building. It appropriately determines that it has one performance obligation which is satisfied over time. Using the following information for Year 1:
Year 1 (of 4-year project): | |
Construction costs incurred during the year | $174,000 |
Estimated costs to complete the contract | 426,000 |
Partial billings to customers | 100,000 |
Collections from customers | 25,000 |
Total contract price | 1,000,000 |
Required:
Prepare the journal entries to record Year 1s (a) construction costs, (b) partial billings, (c) cash collections, and (d) gross profit. |
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Prepare the journal entries to record Year 1s (a) construction costs, (b) partial billings, (c) cash collections, and (d) gross profit.
General Journal Instructions
GENERAL JOURNAL
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