Company's total assets and liabilities by the end of AprilTotal Assets (Cash only): $2,787,000Total Liabilities: $1,863,000Construction projectContract termsDuration: 4/1 ~ 12/31Contract amount:$624,000 with the owner$598,000 with the subcontractors including the suppliersTerms of payment:Monthly paymentThe owner pays the contractor within a month after the contractor bills the owner.The owner holds 5% of each payment to the contractors for retention.The contractor pays the subcontractors within a month after the subcontractors bill the contractor.The contractor holds 5% of each payment to the subcontractors for retention.Information related to revenues and expenses in the project4/1 Project Start4/26 The subcontractors billed $54,000 to the contractor.4/30 The contractor billed $57,000 to the owner.5/20 The owner paid 95% of the amount that the contractor billed in March to the contractor. 5% was held for retention.5/20 The contractor paid 95% of the amount that the subcontractors billed in March to the subcontractors. 5% was held for retention.5/26 The subcontractors billed $41,000 to the contractor.5/31 The contractor billed $47,000 to the owner.What is the amount of total assets on the balance sheet of May 31st?

Identify a contract with a customer: for revenue recognition, the contract can be oral or written,…

Answered: Contract terms Duration: 4/1 ~ 12/31…

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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Company's total assets and liabilities by the end of April

Total Assets (Cash only): $2,787,000
Total Liabilities: $1,863,000

Construction project

Contract terms
- Duration: 4/1 ~ 12/31
- Contract amount:
  - $624,000 with the owner
  - $598,000 with the subcontractors including the suppliers
- Terms of payment:
  - Monthly payment
  - The owner pays the contractor within a month after the contractor bills the owner.
  - The owner holds 5% of each payment to the contractors for retention.
  - The contractor pays the subcontractors within a month after the subcontractors bill the contractor.
  - The contractor holds 5% of each payment to the subcontractors for retention.

Information related to revenues and expenses in the project

4/1 Project Start
4/26 The subcontractors billed $54,000 to the contractor.
4/30 The contractor billed $57,000 to the owner.
5/20 The owner paid 95% of the amount that the contractor billed in March to the contractor. 5% was held for retention.
5/20 The contractor paid 95% of the amount that the subcontractors billed in March to the subcontractors. 5% was held for retention.
5/26 The subcontractors billed $41,000 to the contractor.
5/31 The contractor billed $47,000 to the owner.

What is the amount of total assets on the balance sheet of May 31st?

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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