Question
In 2021, the Southgate Construction Company entered into a contract to construct a bridge for $12,000,000. The bridge was completed in 2023. Information related to
In 2021, the Southgate Construction Company entered into a contract to construct a bridge for $12,000,000.
The bridge was completed in 2023. Information related to the contract is as follows:
2021 2022 2023
Cost incurred during the year $3,000,000 $5,000,000 $3,500,000
Estimated costs to complete as of year-end $8,000,000 $4,200,000 $0
Billings during the year $3,000,000 $4,000,000 $5,000,000
Cash collections during thee year $2,600,000 $3,900,000 $5,100,000
Southgate recognizes revenue using the completed contract method.
What profit (loss) will Southgate record on the contract for 2023?
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