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What entry to put in record revenues part? Crane Enterprises Ltd. has entered into a contract beginning in February 2020 to build two warehouses for
What entry to put in record revenues part?
Crane Enterprises Ltd. has entered into a contract beginning in February 2020 to build two warehouses for Atlantis Structures Ltd. The contract is a non-cancellable fixed price contract for $10.2 million. The following data pertain to the construction period (all figures in thousands). The construction industry has experienced significant expansion, making construction materials and labour more costly than originally estimated. Crane finds it extremely difficult to estimate the costs to complete construction and therefore difficult to estimate the percent complete. It must account for the construction project using the zero-profit method. For Year 2020: Account Titles and Explanation Debit Credit Contract Asset/Liability Materials, Cash, Payables (To record cost of construction) Accounts Receivable Contract Asset/Liability (To record progress billings) Cash 3,110,000 Accounts Receivable (To record collections) Contract Asset/Liability Revenue from Long-Term ContractsStep by Step Solution
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