Question 3:

Percentage of Completion Method (12 marks) On January 1, 2017, Eagle Construction Ltd. started a construction project for $4,500,000. Relevant data for 2017 and 2018 are as follows:

2017 2018

Current year construction costs$3,300,000$ 620,000

Estimated remaining costs to complete600,000-0-

Current year billings3,100,0001,400,000

Current year collections3,000,0001,500,000

Required: Calculate the following amounts for each method:

Completed Percentage-of Contract Completion2017201820172018

a) Gross Profit$$$$

b) Construction in progress year-end balance$$$$

c) Costs in excess of billings (Billings in excess of costs)$$$$