Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Indigo Construction Company has entered into a contract beginning January 1, 2020, to build a parking complex. It has been estimated that the complex will

image text in transcribed
image text in transcribed
Indigo Construction Company has entered into a contract beginning January 1, 2020, to build a parking complex. It has been estimated that the complex will cost $596,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $894,000. The following data pertain to the construction period. 2020 2021 2022 Costs to date $274,160 $417,200 $607,000 Estimated costs to complete 321,840 178,800 -0 550,000 894,000 Progress billings to date 272,000 Cash collected to date 242,000 500,000 894,000 (a) Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0, please enter 0. Do not leave any fields blank.) Gross profit recognized in 2020 $ 137080 Gross profit recognized in 2021 71520 Gre rofit recognized in 2022 78400 (b) Using the completed-contract method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is O, please enter 0. Do not leave any fields blank.) Gross profit recognized in 2020 $ 137080 Estimated costs to complete 321,840 178.800 -0- Progress billings to date 272,000 550,000 894,000 Cash collected to date 242,000 500,000 894,000 (a) Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0, please enter 0. Do not leave any fields blank.) Gross profit recognized in 2020 $ 137080 Gross profit recognized in 2021 $ 71520 Gross profit recognized in 2022 $ 78400 (b) Using the complted-contract method, compute the estimated gross profit that would be recognized during each year of the construction period. (if answer is O, please enter 0. Do not leave any fields blank.) Gross profit recognized in 2020 137080 Gross profit recognized in 2021 71520 Gross profit recognized in 2022 $ 78400

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting And Finance For Non Specialists

Authors: Eddie McLaney

9th Edition

1292062711, 9781292062716

More Books

Students also viewed these Accounting questions