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Sheridan Inc., a real estate developing company, was accounting for its long-term contracts using the completed contract method prior to 2018. In 2018, it changed
Sheridan Inc., a real estate developing company, was accounting for its long-term contracts using the completed contract method prior to 2018. In 2018, it changed to the percentage-of-completion method. The company decided to use the same for income tax purposes. The tax rate enacted is 40%. Income before taxes under both the methods for the past three years appears below.
| 2016 | 2017 | 2018 | ||||
| Completed contract | $415000 | $279000 | $143000 | |||
| Percentage-of-completion | 715000 | 347000 | 235000 |
What amount will be debited to Construction in Process account, to record the change at beginning of 2018?
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