Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,890,000. The project was begun in 2023 and completed in 2024. Cost and other data are presented below: Costs incurred during the year Estimated costs to complete Billings during the year Cash collections during the year 2023 $ 423,000 987,000 445,000 345,000 Amount of gross profit recognized in 2023 Amount of gross profit recognized in 2024 2024 $ 1,190,000 0 1,445,000 1,545,000 Assume that Beavis recognizes revenue on this contract over time according to percentage of completion. Required: Compute the amount of gross profit recognized during 2023 and 2024.
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,890,000. The project was begun in 2023 and completed in 2024. Cost and other data are presented below: Costs incurred during the year Estimated costs to complete Billings during the year Cash collections during the year 2023 $ 423,000 987,000 445,000 345,000 Amount of gross profit recognized in 2023 Amount of gross profit recognized in 2024 2024 $ 1,190,000 0 1,445,000 1,545,000 Assume that Beavis recognizes revenue on this contract over time according to percentage of completion. Required: Compute the amount of gross profit recognized during 2023 and 2024.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Haresh gujariya
Transcribed Image Text:Beavis Construction Company was the low bidder on a construction project to build an earthen dam
for $1,890,000. The project was begun in 2023 and completed in 2024. Cost and other data are
presented below:
Costs incurred during the year
Estimated costs to complete
Billings during the year
Cash collections during the year
2023
2024
$ 423,000 $ 1,190,000
987,000
445,000
345,000
Amount of gross profit recognized in 2023
Amount of gross profit recognized in 2024
0
1,445,000
1,545,000
Assume that Beavis recognizes revenue on this contract over time according to percentage of
completion.
Required:
Compute the amount of gross profit recognized during 2023 and 2024.
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