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Posted on Sep 14, 2024

QUESTION 5 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below:

QUESTION 5 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 3,000,000 Cost: 2017 1,200,000 2018 600,000 Gross profit 2017 800,000 2018 400,000 Contract billings 2017 1,500,000 2018 1,500,000 ADH recognizes revenue over time with respect to these contracts. What would be the journal entry made in 2017 to record revenue? Accounts receivable 1,500,000 Billings in excess of cost 300,000 Revenue for long-term contracts 1.800,000 Construction in progress 800,000 Cost of construction 1,200,000 Revenue from long-term contracts 2,000,000 Accounts receivable 2,300,000 Gross profit 800,000 1,500,000 Revenue from long-term contracts Accounts receivable 1,500,000 1,500,000 Revenue from long-term contracts QUESTION 6 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 3,000,000 Cost: 2017 1,200,000 2018 600,000 Gross profit: 2017 800,000 2018 400,000 Contract billings: 2017 1,500,000 2018 1,500,000 ADH recognizes revenue over time with respect to these contracts In its December 2017, balance sheet, ADH would report: The contract asset, cost and profits in excess of billings, of $500,000. The contract asset, contract amount in excess of billings, of $1,500,000 The contract asset, deferred profit, of $400,000. The contract liability, billings in excess of cost of $300,000. QUESTION 7 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 3,000,000 Cost: 2017 1,200,000 2018 600,000 Gross profit: 2017 800,000 2018 400,000 Contract billings: 2017 1,500,000 2018 1,500,000 ADH recognizes revenue over time with respect to these contracts For 2018, what is the journal entry to record revenue? Construction in progress 400,000 Cost of construction 600,000 Revenue from long-term contracts 1,000,000 Accounts receivable 1,500,000 Revenue from long-term contracts 1,500,000 Cost of construction 2,000,000 Gross profit 1,000,000 Revenue from long-term contracts 3,000,000 Accounts receivable 1,500,000 600,000 Cost of construction 600,000 Gross profit 300,000 Deferred revenue QUESTION 8 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount Cost: Gross profit: 2017 2018 2017 2018 2017 2018 $3,000,000 1,200,000 600,000 800,000 400,000 1,500,000 1,500,000 Contract billings: 800.000 1,200,000 2,000,000 ADH recognizes revenue upon completion of the contract. For 2017, what is the journal entry to record revenue? Construction in progress Cost of construction Revenue from long-term contracts Accounts receivable Revenue from long-term contracts Accounts receivable Gross profit Revenue from long-term contracts No entry. 1,500,000 1,500,000 2,300,000 800,000 1,500,000 QUESTION 9 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $ 3,000,000 Cost: 2017 1,200,000 2018 600.000 Gross profit: 2017 800,000 2018 400,000 Contract billings: 2017 1,500,000 2018 1,500,000 ADH recognizes revenue upon completion of the contract. In its December 31, 2017, balance sheet, ADH would report: The contract liability, billings in excess of cost of $300,000 The contract asset, deferred profit, of $400,000. The contract asset, contract amount in excess of billings, of $1,500,000 The contract asset, cost and profits in excess of billings, of $500,000. QUESTION 10 Arizona Desert Homes (ADH) constructed a new subdivision during 2017 and 2018 under contract with Cactus Development Co. Relevant data are summarized below: Contract amount $3,000,000 Cost: 2017 1,200,000 2018 600,000 Gross profit: 2017 800,000 2018 400,000 Contract billings: 2017 1,500,000 2018 1,500,000 400,000 600,000 1,000,000 ADH recognizes revenue upon completion of the contract. What is the journal entry in 2018 to record revenue? Construction in progress Cost of construction Revenue from long-term contracts Construction in progress Cost of construction Revenue from long-term contracts Accounts receivable Revenue from long-term contracts Cost of construction Gross profit Revenue from long-term contracts 1.200,000 1,800,000 3,000,000 1,500,000 1,500,000 2,000,000 1,000,000 3,000,000