Answered step by step
Verified Expert Solution
Question
1 Approved Answer
very important urgenttttt On June 1, 2019, Al-Bader Construction Company contracted to construct a building for Nass Company, for a total contract price of $12,600,000
very important urgenttttt On June 1, 2019, Al-Bader Construction Company contracted to construct a building for Nass Company, for a total contract price of $12,600,000 The project was to be completed by October 31, 2021 The annual costs incurred, estimated costs to complete the contract, billings to Nass and collections for 2019, 2020, and 2021 are given below 2019 2020 2021 Costs incurred to date $4,320,000 $7,665,000 $10,950,000 Estimated costs to complete 5,280,000 3,285,000 0 Billings to date 4,800,000 10,050,000 12,000,000 Collections to date 3,000,000 3,250,000 9,750,000 Instructions: If Al-Bader Company uses the percentage-of-completion method; 1 Compute the amount of gross profit or loss to be recognized each year 2. Prepare all necessary journal entries for 2020 3 Prepare the journal entry to record the completion of the contract in 2021 4. Prepare partial statement of financial position at December 31, 2019 5 If Al-Bader Company uses the cost-recovery method, prepare the necessary journal entry to recognize any gross profit in 2021
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started