TFAZ X 90 Technical Assignment 1 - Microsoft Excel 5 Links to recor me Share View File Home Insert Page Layout Formulas Data Review View 2 X C = % =-= General Technical Assignment #1 Due September 23 2021 - Microsoft Word Insert 3 Delete === S % . Conditional Formatting Format as Table Cell Styles C. me Insert Page Layout References Mailings Review View . Calibri - 12 BIU AA - . A Font F Paste . 8. Format - 2 Sort & Find & Filter Select Editing alibri (Body) - 12 AA E- SES Clipboard Alignment Number Styles Cells AaBbCcDd AaBbCcDd AaBb Cc 1 Normal 1 No Spacing Heading 1 116 sh Aa ST Change Editing Styles A C E G H 1 K L Font Paragraph Styles 1 E 6.37 2 2018 2019 2020 Contact AssalLiability nt P Technical Assignment #1 Due September 23, 2021 Actual Costs to date $5,000,000 $15,000,000 $ 21,875,000 3 $ 5,000,000 6.500.000 0 nt does not contain $ 5.500.000 500.000 On July 15, 2018 Lotus Builders Ltd. (Lotus) entered into a three-year contract to build a 50-unit condominium for $27.5 million. Information about the contract is provided below for the years ending December 31: 21,875,000 100.00% $ 10,500,000 $11,500,000 $(14500,000) $ (1000.000 End 2020 vigation tabs, create your document by ading Styles 28.000.000 28,000,000 Estimated total costs for the project Costs incurred during the year Billings during the year Collection on billings during the year 2018 $20,000,000 $5,000,000 $6,500,000 $6,250,000 2019 2020 $21,000,000 $21,875,000 $10,000,000 $6,875,000 $10,375,000 $11,125,000 $10,250,000 $11,500,000 16,541,667 6.875,000 9,666,667 6.125,000 21.500.000 11 125.000 Throughout the construction there were many delays resulting in serious concerns about meeting the completion date. In 2020 Lotus brought in additional resources and increased overtime. To its surprise it was able to complete the project a month ahead of schedule on June 15, 2020. This resulted in Lotus receiving a performance bonus of $500,000 for meeting the target date. The performance bonus was not included in the $27.5 million of revenue Lotus expected to generate from the inception of the contract. The total construction costs incurred in 2020 was $6,875,000. On July 2, 2020 all outstanding amounts relating to the project were fully settled. Estimated costs to complete 20.000.000 21,000,000 4 Total Cost of project 25.000.000 5 Estimated) 36,000,000 6 % of completion 20.00% 41.67% 7 8 Expected Revenue 27.500.000 27.500.000 9 10 Reveriue recorded to date 5,500,000 11,458,333 11 Revenue recognized in the 5.500.000 5,958,333 12 period 13 Cost recorded in the period 5. 10.000.000 14 Grass Profit 500,000 -4,041,667 15 Progress billings to date (non- 6.500.000 16.875.000 16 refundable) 17 Progress billing in the period 6.500.000 10.375.000 18 Cash collected la date 19 6.250.000 16,500,000 20 Cash Collected in the period 6,250,000 10,250,000 21 22 2020 2 Contract AsseLiability S 5.000.000 $ 24 Materials, Cash, Payables $ 5,000,000 25 To record cost of construction 26 27 Contract Aseet Liability 5.500.000 Revenue from Long Term 28 Contracts 5.500,000 29 To record revenues 30 31 Accounts Receivable 6.500.000 Contract de Lisbili non KI Long Term contracts E6.37 Sheet2 21,750,000 11,500,000 2021 2022 Required: 10,000,000 $ 6,875,000 $0,000 000 $ 6.875,000 1) How much revenue and gross profit should Lotus recognize each year of the three years if revenue is to be recognized over time under IFRS? 2) Prepare all annual consolidated journal entries required for the entire term of the contract, assuming that Lotus can recognize revenue over time. 3) What journal entries would Lotus have to make if it had to recognize revenue at a point in time, when control of the building was transferred to the owner when it was completed? 5958,333 15 541.667 5,958,333 6.541.667 10.375.000 135.00 11,125.000 + 11.125.00 > 10275. pol 0 IFRS 15-re