Blossom Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $606,000 and will take 3 years to construct. The complex will be billed to the purchasing con at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $266,640 * Your answer is incorrect. 339,360 270,000 240,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 2026 $412,080 193,920 $ 545,000 495,000 2027 $617,000 Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is O. please enter O. Do not leave any fields blank.) -0- 896,000 896,000 204920

Blossom Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $606,000 and will take 3 years to construct. The complex will be billed to the purchasing con at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $266,640 * Your answer is incorrect. 339,360 270,000 240,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 2026 $412,080 193,920 $ 545,000 495,000 2027 $617,000 Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is O. please enter O. Do not leave any fields blank.) -0- 896,000 896,000 204920

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Required information [The following information applies to the questions displayed below.] 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 Westgate recognizes revenue over time according to percentage of completion. Costs incurred during the year Estimated costs to complete as of year-end Revenue Gross profit (loss) 2024 $ 2,184,000 5,616,000 2,120,000 1,860,000 2024 2025 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…
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In 2021, 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 2023. Information related to the contract is as follows: 2021 2022 2023 Cost incurred during the year $2,581,000 $2,347,000 $3,049,200 Estimated costs to complete as of year-end 6,319,000 2,772,000 0 Billings during the year 2,090,000 2,838,000 5,072,000 Cash collections during the year 1,845,000 2,900,000 5,255,000 Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the…
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