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Hamilton Construction Company uses the percentage-of-completion method of accounting. In 2014, Hamilton began work under contract #E2-D2, which provided for a contract price of $2,084,000.

Hamilton Construction Company uses the percentage-of-completion method of accounting. In 2014, Hamilton began work under contract #E2-D2, which provided for a contract price of $2,084,000. Other details follow:

2014

2015

Costs incurred during the year $633,750 $1,754,000
Estimated costs to complete, as of December 31 991,250 0
Billings during the year 399,000 2,084,000
Collections during the year 291,000 1,768,000

(a) What portion of the total contract price would be recognized as revenue in 2014? In 2015?

Revenue recognized in 2014:

Revenue Recognized in 2015:

(b) Assuming the same facts as those above except that Hamilton uses the completed-contract method of accounting, what portion of the total contract price would be recognized as revenue in 2015?

Revenue recognized in 2015:

(c) Prepare a complete set of journal entries for 2014 (using the percentage-of-completion method). (Credit account titles are automatically indented when amount is entered. Do not indent manually. For costs incurred use account Materials, Cash, Payables.)

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