In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows:

2018

2019

2020

Cost incurred during the year

$

3,344,000

$

3,960,000

$

1,645,600

Estimated costs to complete as of year-end

5,456,000

1,496,000

0

Billings during the year

2,800,000

4,504,000

2,696,000

Cash collections during the year

2,600,000

4,400,000

3,000,000

Westgate Construction uses the completed contract method of accounting for long-term construction contracts.

Required:

1.Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years.

2-a.In the journal below, complete the necessary journal entries for the year 2018 (credit "Various accounts" for construction costs incurred).

2-b.In the journal below, complete the necessary journal entries for the year 2019 (credit "Various accounts" for construction costs incurred).

2-c.In the journal below, complete the necessary journal entries for the year 2020 (credit "Various accounts" for construction costs incurred).

In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $3,344,000 $3,960,000 $1,645,600 Estimated costs to complete as of year-end 5,456,000 1,496,000 Billings during the year 2,800,000 4,504,000 2,696,000 Cash collections during the year 2,600,000 4,400,000 3,000,000 Westgate Construction uses the completed contract method of accounting for long- term construction contracts Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2018 (credit "Various accounts" for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2019 credit "Various accounts" for construction costs incurred) 2-c. In the journal below, complete the necessary journal entries for the year 2020 credit "Various accounts" for construction costs incurred)