Question
In 2021, 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
In 2021, 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 2023. Information related to the contract is as follows:
| 2021 | 2022 | 2023 | |||||||
| Cost incurred during the year | $ | 2,581,000 | $ | 2,347,000 | $ | 3,049,200 | |||
| Estimated costs to complete as of year-end | 6,319,000 | 2,772,000 | 0 | ||||||
| Billings during the year | 2,090,000 | 2,838,000 | 5,072,000 | ||||||
| Cash collections during the year | 1,845,000 | 2,900,000 | 5,255,000 | ||||||
Westgate recognizes revenue over time according to percentage of completion.
In the journal below, complete the necessary journal entries for the year 2021 (credit "Various accounts" for construction costs incurred). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Record construction costs. Record progress billings. Record cash collections. Record gross profit (loss).
|
In the journal below, complete the necessary journal entries for the year 2022 (credit "Various accounts" for construction costs incurred). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Record construction costs. Record progress billings. Record cash collections. Record gross profit (loss).
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| 2022 | |||
In the journal below, complete the necessary journal entries for the year 2023 (credit "Various accounts" for construction costs incurred). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Record construction costs. Record progress billings. Record cash collections. Record gross profit (loss).
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| 2023 | |||
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
