Please answer these questions for me. Thank you
Chapter 7 Construction Contracts 343 12. Entity X, a construction firm, enters into a contract to build, water treatment facility for a customer. The contract price is 14. Dark Co. was contracted to build a house for a customer. The total construction costs plus 15% thereof. However, the contract price was P15,000,000. Dark Co. uses the percentage variable fee increases to 20% if the project is completed within of completion method, based on costs, in recognizing revenue three years. Entity X incurs the following costs: from the contract. The estimated total contract costs were Year 1 P12,800,000. Dark Co. incurred the following costs: Year 2 Costs incurred each year Year 3 20x1 20x2 10,500,000 14,300,000 6,000,000 Costs incurred per year 1,536,000 9,992,000 Estimated costs to complete 19,500,000 6,200,000 In 20x2, the customer changed the design of the staircase and In Year 1, it is not highly probable that the additional fee will be agreed to a 5% increase in the original contract price. Dark Co. received. However, after a change in circumstances in Year 2, it is estimated that additional P300,000 costs will be incurred. The now highly probable that the additional fee will be received performance obligation in the contract remains a single Entity X uses the percentage of completion method based on costs. performance obligation. How much are the revenue and gross How much profit is recognized in Year 3? profit recognized in 20x2, respectively? a. 835,000 c. 1,200,000 a. 12,060,000; 2,068,000 c. 12,680,000; 2,268,000 b. 986,000 d. 1,375,000 b. 12,268,000; 2,060,000 d. 12,860,000; 2,862,000 13. In 20x1, Dusk Co. started work on a construction contract with 15. In 20x1, Hungry Co. started work on a long-term construction a fixed price of P4,000,000. Dusk Co. uses the percentage of contract. Hungry Co. accumulates costs and recognized profits completion method and measures its progress based on using the "Construction in progress" account. Information on assessment of the physical completion of the project. The the contract is as follows: 20x1 20x2 estimated total contract costs were P3,000,000. Information on 100,000 300,000 the project is as follows: Accounts receivable, ending balances 105,000 20x2 Costs incurred each year 192,000 20x1 Costs incurred per year 1,425,000 1,125,000 Construction in progress, ending balances 122,000 364,000 Physical completion of project 35% 90% Progress billings, cumulative balances 100,000 420,000 How much are the revenue and cost of construction recognized in Hungry bills the customer based on the project's stage of completion, which is computed using the costs incurred. How 20x2? much are the profit, revenue and total collections in 20x2, Revenue Cost of construction 1,730,000 respectively? a. 2,280,000 b. 2,220,000 1,560,000 a. 46,000; 224,000; 120,000 c. 50,000; 242,000; 120,000 b. 49,000; 240,000; 126,000 d. 50,000; 224,000; 112,000 C. 2,200,000 1,650,000 d. 2,090,000 1,350,000
