Question
In 2024, Long Construction Corporation began construction work under a three-year contract. The contract price is $2,300,000. Long recognizes revenue over time according to percentage
In 2024, Long Construction Corporation began construction work under a three-year contract. The contract price is $2,300,000. Long recognizes revenue over time according to percentage of completion for financial reporting purposes. The financial statement presentation relating to this contract at December 31, 2024, is as follows:
| Balance Sheet | ||
|---|---|---|
| Accounts receivable (from construction progress billings) | $ 37,000 | |
| Construction in progress | $150,000 | |
| Less: Billings on construction contract | (141,000) | |
| Cost and profit of uncompleted contracts in excess of billings | 9,000 |
| Income Statement | |
|---|---|
| Income (before tax) on the contract recognized in 2024 | $ 27,000 |
Required:
- What was the cost of construction actually incurred in 2024?
- How much cash was collected in 2024 on this contract?
- What was the estimated cost to complete as of the end of 2024?
- What was the estimated percentage of completion used to calculate revenue in 2024?
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Food And Beverage Cost Control
Authors: Lea R. Dopson, David K. Hayes
6th Edition
1118988493, 978-1118988497
