Question
Cullumber Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments
Cullumber Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1600000 each quarter. The total contract price is $18654000 and Cullumber estimates total costs of $17800000. Cullumber estimates that the building will take 3 years to complete, and commences construction on January 2, 2021. At December 31, 2021, Cullumber estimates that it is 40% complete with the construction, based on costs incurred. What is the total amount of Revenue from Long-Term Contracts recognized for 2021 and what is the balance in the Accounts Receivable account assuming Cannon Company has not yet made its last quarterly payment?
Revenue | Accounts Receivable |
$7120000 | $1600000 |
$7461600 | $1600000 |
$7120000 | $6218000 |
$6218000 | $6218000 |
Save for Later
Attempts: 0 of 1 used
Submit Answer
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started