Is it correct?
Required information (The following information applies to the questions displayed below.) In 2018, 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 2020. Information related to the contract is as follows: 2020 $2,849,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2018 $2,072,000 5,328,000 2,160,000 1,880,000 2019 $2,738,000 2,590,000 2,650,000 2,700,000 5,190,000 5,420,000 Westgate recognizes revenue over time according to percentage of completion. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. (Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.) 2018 Revenue Gross profit (loss) Revenue $ 2,500,000 3.600,00 2,800,000 $ 728,000 2019 $ 3,600,000 $ 862,000 2020 $ 3,600,000 $ 751,000 Reg 2A Req 2B Req 2c In the journal below, complete the necessary journal entries for the year 2018 (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.) View transaction list View journal entry worksheet No Date General Journal Credit Debit 2,072,000 2018 Construction in progress Various accounts 2,072,000 2018 2,160,000 Accounts receivable Billings on construction contract 2,160,000 3 2018 1,880,000 Cash Accounts receivable 1,880,000 4 2018 Cost of construction Construction in progress Revenue from long-term contracts 2,072,000 728,000 2,800,000 Reg 2A Req 2B Req 2c In the journal below, complete the necessary journal entries for the year 2020 (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.) View transaction list View journal entry worksheet Credit No 1 Date 2020 General Journal Construction in progress Various accounts Debit 2,849,000 2,849,000 2020 5,190,000 Accounts receivable Billings on construction contract 5,190,000 3 2020 5,420,000 Cash Accounts receivable 5,420,000 4 2020 Cost of construction Construction in progress | Revenue from long-term contracts 2,849,000 751,000 3,600,000 $ Revenue Gross profit (loss) 2,800,000 $ 728,000 3,700,000 $(180,000) 2020 $ 3,500,000 $ 651,000 5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign.) 2018 $2,072,000 5, 328,000 Cost incurred during the year Estimated costs to complete as of year-end 2019 $3,880,000 4,260,000 2020 $4,140,000 Revenue Gross profit (loss) $ $ 2018 2,800,000 728,000 $ $ 2019 3,000,000 (880,000) $ $ 2020 4,200,000 60,000
