{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-17T14:31:39-04:00", "answer_date": "2024-06-17 14:31:39", "is_docs_available": "", "is_excel_available": "", "is_pdf_available": "", "count_file_available": 0, "main_page": "student_question_view", "question_id": "3193851", "url": "\/study-help\/questions\/complete-solution-not-third-year-third-year-contract-costs-incur-3193851", "question_creation_date_js": "2024-06-17T14:31:39-04:00", "question_creation_date": "Jun 17, 2024 02:31 PM", "meta_title": "[Solved] complete solution Not third year Third ye | SolutionInn", "meta_description": "Answer of - complete solution Not third year Third year Contract costs incur b. Not third year Fourth year Billings per year 10,00 | SolutionInn", "meta_keywords": "complete,solution,third,year,contract,costs,incur,fourth,billings,per,10,000,000,7,000,000", "question_title_h1": "complete solution Not third year Third year Contract costs incur b. Not third year Fourth year Billings per year 10,000,000 7,000,000 3,000,000 Collections 1,050,000 construction", "question_title": "complete solution Not third year Third year Contract costs incur b. Not", "question_title_for_js_snippet": "complete solution Not third year Third year Contract costs incur b Not third year Fourth year Billings per year 10,000,000 7,000,000 3,000,000 Collections 1,050,000 construction recognized in 20x2, respectively c Third year Third year Collections on billings per year 9,500,000 6,650,000 3,850,000 Estimated costs to complete 2,700,000 Gross profit Revenue Cost of construction d Third year Fourth year d Estimated costs to complete AICPA Adapted) 8,840,000 1,720,000 a 700,000 7,000,000 6,300,000 (at each yr end) How much is the revenue and profit recognized in 20x1, b 920,000 6,000,000 5,080,000 respectively 5 500 000 9 Which of the following is an output method of measuring an c 800,000 4,700,000 Requirements 1,500,000 150,000 entity's progress towards the complete satisfaction of a c 1,470,000 120,000 d 920,000 6,200,000 5,280,000 Compute for the gross profits, revenues and costs of b 1,580,000 230,000 d 1,420,000 70,000 performance obligation in a contract with a customer construction in 20x1, 20x2 and 20x3, respectively costs incurred c appraisal of results achieved Provide the journal entries under (i) traditional accounting The performance obligation is satisfied over time However, resources consumed d labor hours expended 2 During 20x1, Cord Builders, Inc started work on a P9,000,000 Friedland Co cannot reasonably measure the outcome of the and (ii) PFRS 15 fixed price construction contract Cord appropriately uses the c Determine the amounts presented in the financial statements performance obligation but expects to recover all contract 10 An entity enters into a contract with a customer to build an percentage of completion method in accounting for the costs incurred How much are the gross profit, revenue and asset for PIM In addition, the terms of the contract include a contract Cord's accounting records disclosed the following cost of construction recognized in 20x2, respectively Use the information in the preceding problem except that penalty of P100,000 if the construction is not completed within 20x1 20x2 Gross profit Revenue Cost of construction Electrified Co cannot reasonably measure the outcome of the three months of a date specified in the contract Which of the Cumulative contract costs incurred 3,900,000 6,300,000 0 performance obligation but expects to recover all contract a 0 0 following statements is correct Estimated total costs at completion 7,800,000 8,100,000 0 3,920,000 3,920,000 costs incurred (i e , ignore the 'estimated costs to complete ) a The transaction price is a fixed amount of P900,000 c 0 5,080,000 5,080,000 b The transaction price includes a fixed amount of How much are the revenue and cost of construction recognized in d (420 000) 0 Requirements 20x2, respectively P1,000,000 and a variable amount of P100,000 Compute for the gross profits, revenues and costs of C The transaction price includes a fixed amount of P900,000 a 2,220,000 2,150,000 c 2,520,000 2,420,000 At contract inception, Friedland Co assessed the contract in construction in 20x1, 20x2 and 20x3, respectively and a variable amount of P100,000 b 2,520,000 2,400,000 d 2 500 000 2 400 000 accordance with the principles of PERS 15 and concludes that Provide the journal entries under (i) traditional accounting AICPA Adapted) d The transaction price is a variable amount of P900,000, it has a single performance obligation that is satisfied at a and (ii) PERS 15 Determine the amounts presented in the financial statements Use the following information for the next three questions point in time, which is when the construction is completed In 20x1, Friedland Co entered into a contract with a customer for and legal title over the constructed building is transferred to PROBLEM 3 EXERCISES the construction of a building The contract price is a fixed fee of the customer How much are the gross profit, revenue and In 20x1, Electrified Construction Co enters into a contract to PROBLEM 4 MULTIPLE CHOICE COMPUTATIONAL P12,000,000 Information on the contract is shown below cost of construction recognized in 20x2, respectively construct a building for a customer Electrified identifies its Gross profit Revenue Cost of construction In 20x1, Johnny Co enters into a contract to build a house for 20x1 20x2 performance obligation to be satisfied over time Electrified 0 0 Bravo Co for a fixed contract price of P4,500,000 At contract Costs incurred per year 3,920,000 5,080,000 0 measures its progress on the contract based on costs incurred b 0 3,920,000 3,920,000 inception, Johnny Co assesses its performance obligations in Estimated costs to complete 5,880,000 1,000,000 The contract price is P20M Electrified has an unconditional 2,400,000 2,400,000 the contract and concludes that it has a single performance ight to all billings made in accordance with the billing schedule d (420,000) 0 0 obligation that is satisfied over time Johnny Co determines 3 At contract inception, Friedland Co assessed the contract in stated in the contract Information on the construction is as that the measure of progress that best depicts its performance accordance with the principles of PERS 15 and concluded that follows in the contract is the inputs method based on costs incurred it has a single performance obligation that is satisfied over In 20x1, ABC Co enters into a contact with a customer for the construction of a building The contract price is P6M ABC Co At the end of 20x1, Johnny Co 's records show the following time Friedland Co determined that the appropriate measure 342 Chapter 7 Construction Contracts 343 344 Chapter 7 Construction Contracts 345 uses the 'cost to cost' method in measuring its progress on the contract Use the following information for the next two questions In 20x1, Taste Construction Co started work on a P5M fixed price 14 Dawn Co was contracted to build a house for a customer The ABC Co estimates total contract costs at completion of contract Information on the construction is shown below 12 Beaver Co , a construction firm, enters into a contract to build contract price was P25,000,000 Dawn Co uses the percentage P4M ABC incurs actual costs of PIM in 20x1 20x1 20x2 In 20x2, ABC incurs actual costs of P2 45M and revises its 20x3 a dam for a customer, The contract price is total construction of completion method, based on costs, in recognizing revenue Costs incurred to date 1,425,000 4,040,000 5,080,000 costs plus 20 thereof However, the variable fee increases to from the contract The estimated total contract costs were estimate of total contract costs at completion to P4 6M Estimated costs to complete 3 325 000 1 010,000 25 if the project is completed within three years Beaver Co P22,000,000, Dawn Co incurred the following costs ABC completes the construction in 20x3 The actual total incurs the following costs 20x1 20x2 cost of the contract is P4 5M Taste uses the percentage of completion method (based on costs) 20x1 20x2 20x3 Costs incurred to date 3,960,000 18,400,000 in recognizing revenue and profit from the contract Costs incurred each year 10,500,000 How much is the profit recognized in 20x3 14,300,000 6,000,000 Estimated costs to complete 19,500,000 6,200,000 n 20x2, the customer changed the specification of the window a 420,000 c 500 000 b 450,000 8 How much is the loss provision recognized in 20x2 glasses to tempered glass and agreed to pay an additional 5 of d 550,000 25,000 c 10,000 In 20x1, it is not highly probable that the additional fee will be he original contract price The incremental cost was estimated to b 15,000 d 5,000 e P1,000,000 The performance obligation in the contract remains 7 On Jan 1, 20x1, Tuesday Construction Co enters into a received However, after a change in circumstances in 20x2, it is now highly probable that the additional fee will be received single performance obligation How much are the revenue and contract to construct a building for a customer Tuesday How much is the profit (loss) recognized in 20x3 Beaver Co uses the percentage of completion method based on gross profit recognized in 20x2, respectively dentifies its performance obligation to be satisfied over time a (30,000) c (40,000) costs How much profit is recognized in 20x3 12,060,000 2,068,000 c 16,800,000 2,068,000 Tuesday uses the input method based on costs to measure its b 30 000 d 40 000 a 850,000 C 1,200,000 b 14,268,000 2,060,000 d 16,500,000 2,060,000 progress on the contract The contract price is POM b 980 000 d 1,500,000 Information on the construction is provided below Use the following information for the next two questions 15 In 20x1, Espresso Co started work on a long term construction 20x1 20x2 20x3 Bass Co appropriately uses the cost to cost method in measuring 13 In 20x1, Light Co started work on a construction contract with contract Espresso Co accumulates costs and recognized Contract costs incurred per year 3,120,000 3,810,000 810,000 its progress on a construction contract with a customer profits using the Construction in progress account Billings per year a fixed price of P4,000,000 Light Co uses the percentage of 4,000,000 3,000,000 2,090,000 Information on this contract, which was completed in 20x3, is completion method and measures its progress based on Information on the contract is as follows Estimated costs to complete 4 680,000 770 000 shown below ssessment of the physical completion of the project The 20x1 20x2 20x1 20x2 20x3 estimated total contract costs were P3,000,000 Information on Accounts receivable, ending balances 250,000 750,000 All billings in a year were collected also in that year What Transaction price 20,000,000 20,000,000 20,000,000 the project is as follows Costs incurred each year 262,500 480,000 amounts are presented in Tuesday's Dec 31, 20x2 statement of Profit each year 400,000 1,400,000 financial position under traditional accounting and PFRS 15, (200,000) 20x1 Construction in progress, ending balances 305,000 910,000 Costs incurred each year 3,600 000 8,200,000 Costs incurred per year 20x2 1,425,000 1,125,000 Progress billings, cumulative balances 250,000 1,050,000 respectively AICPA Adapted) Physical completion of project Gross amount due from (due to) cust 32 90 Contract asset (liability) a 600 000 Espresso bills the customer based on the project's stage of 600,000 10 How much are the contract costs incurred in 20x2 How much are the revenue and cost of construction recognized in completion, which is computed using the costs incurred How b (600,000) (600,000) a 5,800,000 c 6,600,000 20 2 c (1,100,000) 6,200,000 1 10,200,000 much are the profit, revenue and total collections in 20x2, (1,100,000) Revenue Cost of construction respectively 1,100,000 a 2,320,000 1,740,000 a 125,000 605,000 300,000 c 50,000 242,000 120,000", "question_description": "
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