For numbers 23 to 27: DJ Builders Construction Company has used the cost-to-cost percentage of completion method of recognizing revenue. Ambrose assumed leadership of the business after the recent death of his father. In reviewing the records, Ambrose finds the following information regarding a recently completed building project for which the total contract was P2,000,000. 2019. 2020. 2021 Gross profit (loss) each year Costs incurred each P140,000. P40,000. 360,000. P(20,000) 820,000 year. Ambrose wants to know how effectively the company operated during the last 3 years on this project and since the information is not complete, has asked for answers to the following questions:

For numbers 23 to 27: DJ Builders Construction Company has used the cost-to-cost percentage of completion method of recognizing revenue. Ambrose assumed leadership of the business after the recent death of his father. In reviewing the records, Ambrose finds the following information regarding a recently completed building project for which the total contract was P2,000,000. 2019. 2020. 2021 Gross profit (loss) each year Costs incurred each P140,000. P40,000. 360,000. P(20,000) 820,000 year. Ambrose wants to know how effectively the company operated during the last 3 years on this project and since the information is not complete, has asked for answers to the following questions:

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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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

100%

dont mind the questions in the picture, just answer this two

What was the estimated gross profit on the project by the end of 2020?

P140,000

P160,000

P180,000

P300,000

What was the estimated cost to complete the project at the end of 2020?

P1,700,000

P660,000

P1,020,000

P680,000

For numbers 23 to 27: DJ Builders Construction Company has used the cost-to-cost percentage of completion method of
recognizing revenue. Ambrose assumed leadership of the business after the recent death of his father. In reviewing the
records, Ambrose finds the following information regarding a recently completed building project for which the total
contract was P2,000,000.
2019.
2020.
2021
Gross profit (loss) each year
Costs incurred each year.
P40,000.
360,000.
Р(20,000)
820,000
P140,000.
Ambrose wants to know how effectively the company operated during the last 3 years on this project and since the
information is not complete, has asked for answers to the following questions:
23. How much cost was incurred in 2020?
P1,840,000
b. 820,000
с. 1,180,000
d. 660,000
а.
24. What percentage of the project was completed by the end of 2020?
а.
90%
b. 40%
c. 51%
d. 60%
25. What was the percentage of completion during the year 2020?

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