8. On January 1, 2018, Liquid Company accepted a long-term construction project for an initial contract price of P2,000,000 to be completed on June 30, 2020. On January 1, 2019, the contract price was increased to P3,000,000 by reason of change in the design of the project. The outcome of the construction contract can be estimated reliably. The project was completed on December 31, 2020 which resulted to penalty amounting to P400,000. The entity provided the following data concerning the direct costs related to the said project for 2018 and 2019: 2019 2018 Costs during the year 880,000 1,360,000 Remaining estimated costs to complete at year- 1,320,000 560,000 end
8. On January 1, 2018, Liquid Company accepted a long-term construction project for an initial contract price of P2,000,000 to be completed on June 30, 2020. On January 1, 2019, the contract price was increased to P3,000,000 by reason of change in the design of the project. The outcome of the construction contract can be estimated reliably. The project was completed on December 31, 2020 which resulted to penalty amounting to P400,000. The entity provided the following data concerning the direct costs related to the said project for 2018 and 2019: 2019 2018 Costs during the year 880,000 1,360,000 Remaining estimated costs to complete at year- 1,320,000 560,000 end
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:8. On January 1, 2018, Liquid Company accepted a long-term construction project for an initial
contract price of P2,000,000 to be completed on June 30, 2020. On January 1, 2019, the
contract price was increased to P3,000,000 by reason of change in the design of the project.
The outcome of the construction contract can be estimated reliably. The project was completed
on December 31, 2020 which resulted to penalty amounting to P400,000. The entity provided
the following data concerning the direct costs related to the said project for 2018 and 2019:
2019
2018
Costs during the year
Remaining estimated costs to complete at year-
880,000
1,360,000
1,320,000
560,000
end
What is the construction revenue for the year ended December 31, 2018?
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