Question
On Jan 1st, 2019, ACDC Co. signed a contract to construct a bridge to be completed by the end of 2021. The cataract price is
On Jan 1st, 2019, ACDC Co. signed a contract to construct a bridge to be completed by the end of 2021. The cataract price is $2,500,000. ACDC Co provides the following information for the project progress.
Details | 2019 | 2020 | 2021 |
Cost incurred to date | $600,000 | $1,400,000 | $2,100,000 |
Estimated cost to complete | $900,000 | $600,000 | $0 |
Customer billings | $500,000 | $600,000 | $350,000 |
Cash collections | $400,000 | $500,000 | $300,000 |
Assuming that ACDC uses the percentage of completion method, the cost incurred (used) in 2020 is
Select one:
a. $700,000
b. $600,000
c. $800,000
d. $1,400,000
Assuming that ACDC uses the cost-recovery method, the company record gross profit (loss) in 2019 of
Select one:
a. $400,000
b. $350,000
c. $50,000
d. $0
Assuming that ACDC uses the percentage of completion method, the percentage of completion for 2019 is
Select one:
a. 40%
b. 75%
c. 30%
d. 100%
assuming that ACDC uses the percentage of completion method, Gross Profit (loss) for the year 2020 is
Select one:
a. $(50,000)
b. $350,000
c. $500,000
d. $400,000
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