Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price or 58,330,000. During 2021, costs

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price or 58,330,000. During 2021, costs of $2,110,000 were incurred with estimated costs of $4,110,000 yet to be incurred. Billings of $2,610,000 were sent and cash collected was $2,360,000 In 2022. costs incurred were $2.610.000 with remaining costs estimated to be $3765,000 2022 billings were $2.860,000 and $2.585.000 cash was collected. The project was completed in 2023 after additional costs of $3,910,000 were incurred. The company's incal year-endis December 31 Arrow recognizes revenue over time according to percentage of completion Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 2022 and 2023 using the percentage of completion method 20. Prepare journal entries for 2021 to record the transactions described credit various accounts for construction costs incurred 2b. Prepare journal entries for 2022 to record the transactions described (credit various accounts for construction costs incurred. 30. Prepare a partiat balance sheet to show the presentation of the project as of December 31, 2021 3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022 Complete this question by entering your answers in the tabs below. Req1 Reg 2A Res 20 RegJA Re 30 Compute the amount of revenue and gross profit or loss to be recognized in 2021, 2022 and 2023 using the percentage of completion method. (Do not round Intermediate calculations. Los amounts should be indicated with a mission Round your final answers to the Mearest whole dolia) Percentages of completion Choose rumento Choose denominator complete te O 2021 2022 2023 o 0 2021 Recognized in prior years To date Hetegnized in 2020 5 0 Construction avenue Construction expense Cross protons) 3 0 $ To date 2022 Recognized in prior years Recognized in 2002 o Construction Construction expense Oross profile 3 3 2022 Recognized in prior years Te date Hecognd in 2023 5 Construction revenue Constructor ponse Gross pro dos 3 $ Reg 2 ) Record the construction costs. te beter den before General Journal Detit Year 2022 Record entry Clearney View general ( Req2A Regs>

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 Financial System Reform In Eastern Europe And Asia

Authors: Robert W. McGee, Galina G. Preobragenskaya

2nd Edition

0387257098, 9780387257099

More Books

Students also viewed these Accounting questions

Question

a. What department offers the course?

Answered: 1 week ago

Question

Describe the disciplinary action process.

Answered: 1 week ago