Ivanhoe Construction Inc., which has a calendar year end, has entered into a non-cancellable fixed price contract for $2.6 million beginning September 1, 2020, to build a road for a municipality. It has been estimated that the road construction will be complete by June 2022. The following data pertain to the construction period.

		2020		2021		2022
Costs to date		$846,000		$1,576,200		$2,182,000
Estimated costs to complete		1,504,000		553,800		0
Progress billings to date (non-refundable)		914,000		2,132,000		2,600,000
Cash collected to date		746,000		1,999,000		2,600,000

Using the percentage-of-completion method, what is the balance in the Contract Asset/Liability account at December 31, 2020 and 2021? (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

		December 31, 2020		December 31, 2021
Balance in the Contract Asset/Liability account		$		$

List of Accounts

Question Part Score

--/3

Using the percentage-of-completion method, show how the construction contract would be reported on the statement of financial position (SFP) and the income statement for the year ended December 31, 2021.

IVANHOE CONSTRUCTION INC. Partial Statement of Financial Position December 31, 2021Quarter Ended December 31, 2021Month Ended December 31, 2021
select an opening name for subsection one Current AssetsIntangible AssetsCurrent LiabilitiesLong-term LiabilitiesProperty, Plant and EquipmentShareholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal LiabilitiesTotal Liabilities and Shareholders' EquityTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Shareholders' Equity
		$
select an opening name for subsection one Current AssetsIntangible AssetsCurrent LiabilitiesLong-term LiabilitiesProperty, Plant and EquipmentShareholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal LiabilitiesTotal Liabilities and Shareholders' EquityTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Shareholders' Equity
		$

IVANHOE CONSTRUCTION INC. Partial Income Statement Month Ended December 31, 2021Quarter Ended December 31, 2021Year Ended December 31, 2021
		$
select a summarizing line for the first part RevenuesGross Profit / (Loss)Total ExpensesNet Income / (Loss)Operating ExpensesOther Expenses and LossesExpensesIncome from OperationsTotal RevenuesDividends		$

List of Accounts

Question Part Score

--/5

Prepare a table comparing the gross profit recognized in each of the three years under (1) the percentage-of-completion method, (2) the zero-profit method, and (3) the completed-contract method. (Do not leave any answer field blank. Enter 0 for amounts.)

		(1) Percentage-of-Completion		(2) Zero-Profit		(3) Completed-Contract
2020		$		$		$
2021		$		$		$
2022		$		$		$