REVENUE RECOGNITION

required:

A) using the percentage of completion method, compute the revenue and profit or loss to be recognized as a result of this contract for the years ended December 31, 2020, 2021, and 2022

B) complete the JE that Frogly would make for this JE in 2021

On August 1, 2020, Frogly Construction Company Inc. contracted to build a large manufacturing facility for SmithCo. The negotiated contract price was $3,800,000. On August 1, 2020, Frogly estimated that it would take between two and three years to complete the facility. In November 2022, the building was deemed substantially completed. The following tables includes accumulated contract costs incurred, estimated costs to complete the contract, accumulated billings to SmithCo, and cash received from Smith Co in 2020, 2021, and 2022 2020 2021 2022 Costs incurred to date 4,200,000 Estimated costs to complete 0 300,000 2,700,000 600,000 400,000 2,400,000 1,600,000 2,200,000 1,400,000 Cumulative billings to Smith Co Cash received from SmithCo during 3,800,000 1,800,000 the year