Question
In 2024, 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 2024, 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 2026. Information related to the contract is as follows:
| 2024 | 2025 | 2026 | |
|---|---|---|---|
| Cost incurred during the year | $ 2,523,000 | $ 3,177,000 | $ 1,980,000 |
| Estimated costs to complete as of year-end | 6,177,000 | 1,800,000 | 0 |
| Billings during the year | 2,070,000 | 3,630,000 | 4,300,000 |
| Cash collections during the year | 1,835,000 | 3,400,000 | 4,765,000 |
Required:
1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years.
Note: Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.
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Accounting Principles Volume 2 Chapters 13 To 26
Authors: Jerry J. Weygandt
11th Edition
1118342070, 978-1118342077
