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Part 1: Work the following requirements from P5-13 on page 288 from your book. Part 1 Part 2a Part 2b Part 3a (revenue for the contract from 2018 and 2019) Part 3b (gross profit for the contract from 2018 and 2019) Part 2: Baker, a consulting firm, enters into a contract to help a small family owned business design a marketing strategy to compete with other companies in the region.. The contract spans eight months. Bakers client promises to pay $93,000 at the beginning of each month. At the end of the contract, Baker either will give their client a refund of $31,000 or will be entitled to an additional $31,000 bonus, depending on whether sales at Burger Boy at year-end have increased to a target level. At the inception of the contract, Baker estimates an 80% chance that it will earn the $31,000 bonus and calculates the contract price based on the expected value of future payments to be received. At the end of the contract, Baker receives the additional consideration of $31,000. Required: 1. Prepare the journal entry to record revenue for each of the first four months of the contract. 2. Prepare the journal entry that Baker would record after eight months to record the receipt of the $31,000 bonus.

SECTION1 The Role of Accounting as an Information System Citation Builders, Inc., builds office buildings and single-family homes. The office buildings are constructed under contract with reputable buyers. The homes are constructed in developments ranging from 10-20 homes and are typically sold during construction or soon after. To secure the home upon completion, buyers must pay a deposit of 10% of the price of the home with the remaining balance due upon completion of the house and transfer of title. Failure to pay the full amount results in forfeiture of the down payment. Occasionally, homes remain unsold for as long as three months after construction. In these situations, sales price reductions are used to promote the sale. erm t; revenue tion e vs. oject ion During 2018, Citation began construction of an office building for Altamont Corporation. The total contract price is $20 million. Costs incurred, estimated costs to complete at year-end, billings, and cash collections for the life of the contract are as follows: 2018 2019 $ 9,500,000 4,500,000 10,000,000 8,600,000 2020 Costs incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year $ 4,000,000 $4,500,000 12,000,000 2,000,000 1,800,000 8,000,000 9,600,000 g 2018, Citation began a development consisting of 12 identical homes. Citation estimated that each home will sell for $600,000, but individual sales prices are negotiated with buyers. De eight of the homes, three of which were completed during 2018and naid for in full f posits were received for