Recording Long-term Construction: Recognize Revenue at a Point in Time and Over Time Smith Construction contracted with a developer to build an apartment building with retail space for $6,000,000. Information relating to this contract follows. Costs incurred to date Estimated costs for completion Customer billings to date Customer collections to date 2020 2022 2021 $2,360,000 $4,660,000 $6,300,000 2,640,000 1,440,000 2,000,000 4,000,000 6,000,000 1,500,000 3,500,000 6,000,000 Required Part A Part B a. Provide the 2020, 2021, and 2022 journal entries assuming revenue is recognized at a point in time. Provide entries for (1) construction costs incurred, (2) progress billings, (3) cash collections, and (4) losses, revenues and expenses. Note: Record any multiple debits in alphabetical order and any multiple credits in alphabetical order. Note: If a journal entry (or a line of the journal entry) isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Note: Do not round until your final answers; round your final answers to the nearest whole dollar. Account 1. Construction in Process Cash and Payables etc. To record constructions costs incurred 2. Accounts Receivable Billings on Contracts To record progress billings 3. Cash Accounts Receivable To record collections 4. Construction in Process 2020 Debit Credit 0 0 0 0 0 0 0 0 0 0 0 0 Cost of Construction To recognize revenues 0 Revenue from Long Term Contracts 0 0 0 0 N/A To recognize expenses Account 1. Construction in Process Cash and Payables etc. To record constructions costs incurred 2. Accounts Receivable Billings on Contracts To record progress billings 2021 Debit Credit 0 0 0 0 0 0 0 0 3. Cash Accounts Receivable 0 0 0 0 To record collections 4. Cost of Construction Construction in Process 0 0 0 0 To recognize revenues or gains Loss from Long Term Contracts 0 0 N/A 0 0 To recognize expenses or losses Account 1. Construction in Process Cash and Payables etc. To record constructions costs incurred Accounts Receivable. 2022 Debit Credit 0 0 0 0 Account 1. Construction in Process Cash and Payables etc. To record constructions costs incurred 2. Accounts Receivable Billings on Contracts 2022 Debit Credit 0 0 0 0 0 0 0 0 To record progress billings 3. Cash 0 0 Accounts Receivable 0 0 To record collections 4. Cost of Construction 0 0 Construction in Process 0 0 To recognize revenues Revenue from Long Term Contracts 0 0 N/A 0 0 To recognize expenses Part A Part B b. Provide the 2020, 2021, and 2022 journal entries assuming revenue is recognized over time. Provide entries for (1) construction costs incurred, (2) progress billings, (3) cash collections, (4) revenues and expenses, and (5) to close out accounts upon completion of the contract. Note: Record any multiple debits in alphabetical order and any multiple credits in alphabetical order. Note: If a journal entry (or a line of the journal entry) isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Note: Do not round until your final answers; round your final answers to the nearest whole dollar. 1. Account 2020 Debit Credit 0 0 0 0 To record constructions costs incurred 2. 0 0 0 0 To record progress billings 3. 0 0 0 To record collections 4. 0 0 0 0 0 0 1. 2. To recognize revenues and expenses Account To record constructions costs incurred 2021 Debit Credit 0 0 0 0 0 0 2. = 0 0 0 0 To record progress billings 3. 0 0 0 0 To record collections 4. 1. 2. To recognize revenues and expenses Account To record constructions costs incurred 0 0 0 0 0 0 2022 Debit Credit 0 0 0 0 0 0 0 0 To record progress billings 3. 0 0 0 0 To record collections 4. 0 0 0 0 0 0 5. To recognize revenues and expenses To close out billings and CIP 0 0 0 0