Answered step by step
Verified Expert Solution
Question
1 Approved Answer
On July 1, 2020, Ivanhoe Construction Company Inc. contracted to build an office building for Gumbel Corp. for a total contract price of $1,920,000.
On July 1, 2020, Ivanhoe Construction Company Inc. contracted to build an office building for Gumbel Corp. for a total contract price of $1,920,000. On July 1, Ivanhoe estimated that it would take between 2 and 3 years to complete the building. On December 31, 2022, the building was deemed substantially completed. Following are accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Gumbel for 2020, 2021, and 2022. At 12/31/20 At 12/31/21 At 12/31/22 Contract costs incurred to date $270,000 $1,272,600 $2,121,000 Estimated costs to complete the contract Billings to Gumbel 1,230,000 747,400 300,000 1.110,000 -0- 1.880,000 (a) Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2020, 2021, and 2022. (Ignore income taxes.) (If answer is 0, please enter 0. Do not leave any field blank. If an amount should be deducted then enter the amount using either a negative sign prececeding the number eg.-45 or parenthesis es. (45))
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started