Honesty Construction is in its fourth year of business. The company has long-term construction projects and accounts for them using the percentage of completion method. Honesty Company built an apartment building at a price of P500,000. The costs and billings for this contract for the first three years are as follows: 2021 2022 2023 395,000 0 Cost incurred to date Estimated costs yet to be incurred Customer billings to date Collections of billings to date Determine the profit from construction recognized in 2022. 160,000 240,000 75,000 60,000 300,000 100,000 205,000 500,000 170,000 475,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Honesty Construction is in its fourth year of business. The company has long-term construction projects and
accounts for them using the percentage of completion method. Honesty Company built an apartment building at a
price of P500,000. The costs and billings for this contract for the first three years are as follows:
2021
2022
2023
395,000
0
Cost incurred to date
Estimated costs yet to be incurred
Customer billings to date
Collections of billings to date
Determine the profit from construction recognized in 2022.
160,000
240,000
75,000
60,000
300,000
100,000
205,000
170,000
500,000
475,000
Transcribed Image Text:Honesty Construction is in its fourth year of business. The company has long-term construction projects and accounts for them using the percentage of completion method. Honesty Company built an apartment building at a price of P500,000. The costs and billings for this contract for the first three years are as follows: 2021 2022 2023 395,000 0 Cost incurred to date Estimated costs yet to be incurred Customer billings to date Collections of billings to date Determine the profit from construction recognized in 2022. 160,000 240,000 75,000 60,000 300,000 100,000 205,000 170,000 500,000 475,000
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