1. Princes Inc. contracted P&P Company to construct a building for $1, 400.000n a Landcosting $100,000 (purchased from the contractor and included in the first payment)Princess Inc. made the following payments to the construction Company during 2012.Jan 1$210,000MarchMayDecTotal$300,00$540,00$450,000$1,500,000Specific Construction Debt15% 3-year note to finance purchase of land and building dated Dec. 31, 2011 with interestpayable annually on Dec. 31Other Debts10%, 5 year note payable with interest payable annually on Dec. 3112%, 10 year bonds with interest payable annually on Dec. 31

**1. Construction Contract and Cost Allocation:** - Princess Inc. entered into a construction…

Answered: 1. Princes Inc. contracted P&P Company…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 7MC

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Required: Compute the following, placing your answer in the spaces provided and showing PROBLEMS 361 Supporting computations below: 1 Cash collected by KP on Cincy One during 20x4 2 Actual costs incurred by KP on Cincy One during 20x4 2 On December 31, 20x4, the estimated remaining costs to complete 4. The percentage of Cincy One that was completed during 20x4
PAP-3A McNeil Construction Company is involved in a long-term construction contract to build an office building. The estimated cost is $30 million, and the contract price is $38 million. Additional information follows. Office Building Cash Collections $ 6,000,000 8,000,000 12,500,000 11,500,000 Actual Costs Incurred $ 4,500,000 6,000,000 2011 2012 2013 12,000,000 2014 7,500,000 The project is completed in 2014, and all cash to be received from the contract has been received. Instructions Prepare a schedule to determine the gross profit in each year for the long-term construction con- tract using the percentage-of-completion method.
JRE2 Incorporated entered into a contract to install a pipeline for a fixed price of $2,275,000. JRE 2 recognizes revenue upon contract completion. Cost incurred Estimated Cost to Complete 2023 $ 260,000 $ 1,600,000 2024 1,650,000 550,000 2025 500,000 0 In 2024, JRE2 would report gross profit (loss) of: Multiple Choice $(320,000). $(235,000). $(185,000). So.
es In 2024, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2026. Information related to the contract is as follows: 2024 $ 3,471,000 5,429,000 2,900,000 2,700,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Cost incurred during the year Estimated costs to complete as of year-end 2025 $ 4,005,000 1,424,000 4,576,000 4,500,000 Cost incurred during the year Estimated costs to complete as of year-end Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2024 $ 2,490,000 5,690,000 2-b.…
How much is the cost of the qualifying asset on initial recognition? * 15,045,000 13,010,000 14,970,900 14,920,000
Zorzi b egan work on a $420 000 construction contract in 2017. During 2017 Zorzi incurred costs of S278,000, billed its customer for $215.000, ancd collected $175,000. At December 31, 2017, the estimated additional costs to complete the project total $162,000, Prepare Zorzi's Jourmal entry to record profit or loss using the Completed Contract Method O Loss from Long Tem Contracts $20,000 Comsitruction in Process $20,000 O Income from Long Term Contracts Construction in Process $20.000 $20,000 O Loss from Long Term Contracts Construction in Process $40,000 $40,000 O Gain from Long Term Contracts Construction in Process $40.000 $40.000
Dumb Company constructed its own factory building. The company had a P1,000,000 two-year 12% loan specifically obtained to finance the asset construction. The construction began on January 1, 2021 and the building was completed on December 30, 2022. Expenditures on the building were made as follows: January 1, 2021 P800,000April 30, 2021 300,000November 1, 2021 600,000March 1, 2022 600,000September 30, 2022 400,000Dumb has the following outstanding loans from general borrowings: 10% note issued prior to construction of new building; term, 10 years 1,500,000 12% note issued prior to construction of new building; term, 15 years 2,500,000 13) How much is total initial cost of the building? 14) How much is the finance cost that should be recognized in profit or loss for the year 2022?
What amount is presented as ABC Co's statement of financial position as contract liability?
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grant is a zero-interest loan for 5 years evidenced by a balan government Ja lance P200,000 go The machie is to be deprecia It Required: i the asset. Problem 24-6 (IAA) Zephyr Company is provided a grant by a foreign gover for the purpose of acquiring land for a building site ent grant is a zero-interest loan for 5 years evidenced he promissory note. The loan was granted on January 1, 2020 for P8,000;000 Th. market rate of interest is 6%. The present value of 1 for f periods at 6% is .7473. Required: Prepare journal entries for 2020 and 2021.
- Entity A acquires equipment on January 1, 20x1. Information on costs is as follows: Purchase price, gross of Php 10,000 trade discount Non-refundable purchase taxes Delivery and handling costs Installation costs 800,000 20,000 40,000 30,000 Present value of decommissioning and restoration Costs 10,000 How much is the initial cost of the equipment? a. 900,000 b. 820,000 c. 870,000 d. 890,000

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