On January $1,$ Miller Construction Company contracted to build a parking lot for the city of St$.$ Louis for $$750,000.$ The following transactions and estimates relate to this contract.

a$.$ Construction costs incurred during the year $$200,000$

b$.$ Progress billings $$190,000$

c$.$ Cash collections $$175,000$

d$.$ Estimated costs to complete $$400,000$

Required

$1.$ The company accounts for revenue over time. Compute the percent complete at the end of the first year.

Percent Complete Numerator Denominator Result

At the end of Year $1$ Answer

$200,000$

$-$: Answer

$600,000$

$=$

$33\mathrm{.}33$

$2.$ Prepare the journal entries to record $($a$)$ costs incurred, $($b$)$ progress billings, $($c$)$ collections, and $($d$)$ any revenue or expense recognition.

$$Note: Use the result EXACTLY as displayed above in the calculations below.

$$Note: If a journal entry isn't required on any of the dates shown, select $"$N$/$A$$debit$"$ and $"$N$/$A$$credit$"$ as the account names and leave the Dr$.$ and Cr$.$ answers blank $($zero$).$

Ref. Account Name Dr$.$ Cr$.$

a$.$

Construction in Process

$200,000$

$0$

Answer

Cash

$0$

$200,000$

Answer

To record constructions costs incurred

b$.$

Accounts Receivable

$190,000$

$0$

Answer

Billings on Contracts

$0$

$190,000$

Answer

To record progress billings

c$.$

Cash

$175,000$

$0$

Answer

Billings on Contracts

$0$

$175,000$

Answer

To record collections

d$.$

Billings on Contracts

$200,000$

$0$

Answer

N$/$A$$Credit

$50,000$

$0$

Answer

N$/$A$$Debit

$0$

$250,000$

Answer