Question
During 2014, Nilsen Company started a construction job with a contract price of $1,936,000. The job was completed in 2016. The following information is available.
During 2014, Nilsen Company started a construction job with a contract price of $1,936,000. The job was completed in 2016. The following information is available.
| |2014 |2015 |2016
|Costs incurred to date |$484,000 |$998,250 |$1,294,700
|Estimated costs to complete|$726,000|$332,750 |$0
|Billings to date|$363,000|$1,089,000|$1,936,000
|Collections to date|$326,700|$980,100|$1,724,250
a. Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
b. Prepare all necessary journal entries for 2015, assuming all costs are on account.
Do not copy from Chegg and give complete answer with explanation
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