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On June 15, 2021, Sanderson Construction entered into a longeterm construction contract to build a baseball stadium in Washington, D.C., for $270 million. The expected
On June 15, 2021, Sanderson Construction entered into a longeterm construction contract to build a baseball stadium in Washington, D.C., for $270 million. The expected completion date is April1. 2023, just in time for the 2023 baseball season. Costs incurred and estimated costs to complete at year-end for the life ofthe contract are as follows (EB in millions): 2021 2622 2023 Costs incurred during the year 55 50 $100 $60 Estimated costs to complete as of December 31 150 90 Required: 1. Compute the revenue and gross profit will Sanderson report in its 2021, 2022. and 2023 income statements related to this contract assuming Sanderson recognizes revenue over time according to percentage of completion. 2. Compute the revenue and gross profit will Sanderson report in its 2021, 2022, and 2023 income statements related to this contract assuming this project does not qualify for revenue recognition over time. 3. Suppose the estimated costs to complete at the end of 2022 are $100 million instead of $90 million. Compute the amount of revenue and gross profit or loss to be recognized in 2022 assuming Sanderson recognizes revenue overtime according to percentage of completion. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the revenue and gross prot will Sanderson report in its 2021, 2022, and 2023 income statements related to this contract assuming Saaderson recognizes revenue over time according to percentage of completion. (Enter your answer in millions (i.e., 54,000,000 should be entered as $4). Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the table below to arrive at your final answer.) Show less; 2021 2022 2023 Construction revenue Construction expense Gross prot (loss) Construction revenue Construction expense Gross prot (loss) Construction revenue Construction expense Gross prot (loss) Choose numerator - Choose denominator % complete to date Actual costs to date - Estimated total costs _ 25.00% _ 62.50% _ $ 100.00% 57.500 $ $ $ - $ $ $ - $ $ $ $4,000,000 should be entered as $4). Loss amounts should be Year Revenue Gross Profit (Loss) recognized recognized 2021 million million 2022 million million 2023 million million Required 1Percentages of completion Choose numerator Choose denominator % complete to date 2022 0 2022 To date Recognized in prior Years Recognized in 2022 Construction revenue $ 0 Construction expense 0 Gross profit (loss) S
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