5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs ncurred and costs to complete information. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign. Costs incurred during the year Estimated costs to complete as of year-end Revenue Gross profit (loss) 2024 2025 2024 $ 2,523,000 6,177,000 2026 2025 $ 3,835,000 4,170,000 2026 $ 4,005,000 0

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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jagdish

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:
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
2024
$ 2,523,000
6,177,000
2,070,000
1,835,000
2025
$ 3,177,000
1,800,000
3,630,000
3,400,000
2026
$ 1,980,000
0
4,300,000
4,765,000
Transcribed Image Text: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: Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2024 $ 2,523,000 6,177,000 2,070,000 1,835,000 2025 $ 3,177,000 1,800,000 3,630,000 3,400,000 2026 $ 1,980,000 0 4,300,000 4,765,000
5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs
incurred and costs to complete information.
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.
Costs incurred during the year
Estimated costs to complete as of year-end
Revenue
Gross profit (loss)
2024
2025
2024
$ 2,523,000
6,177,000
2026
2025
$ 3,835,000
4,170,000
2026
$ 4,005,000
0
Transcribed Image Text:5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs incurred and costs to complete information. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign. Costs incurred during the year Estimated costs to complete as of year-end Revenue Gross profit (loss) 2024 2025 2024 $ 2,523,000 6,177,000 2026 2025 $ 3,835,000 4,170,000 2026 $ 4,005,000 0
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