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 $1,400,000 $3,150,000 $2,695,000 Estimated costs to complete as of year-end 5,600,000 2,450,000 0 Billings during the year 1,000,000 3,550,000 5,450,000 Cash collections during the year 800,000 2,600,000 6,600,000 Assume that Westgate Construction’s contract with Santa Clara County does not qualify for revenue recognition over time. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years using the above information. (Leave no cells blank – be certain to enter “0” wherever required. Loss amounts should be indicated with a minus sign.) 2021 2022 2023 Cost incurred during the year $2,600,000 $3,900,000 $3,300,000 Estimated costs to complete as of year-end 5,800,000 3,300,000 2021 2022 2023 Cost incurred during the year $2,600,000 $3,900,000 $4,200,000 Estimated costs to complete as of year-end 5,800,000 4,300,000 2021 2022 2023 Revenue _____________ _____________ _______________ Gross profit (loss) _____________ ______________ ______________
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 $1,400,000 $3,150,000 $2,695,000
Estimated costs to complete as of year-end 5,600,000 2,450,000 0
Billings during the year 1,000,000 3,550,000 5,450,000
Cash collections during the year 800,000 2,600,000 6,600,000
Assume that Westgate Construction’s contract with Santa Clara County does not qualify for revenue recognition over time.
- Calculate the amount of revenue and gross
profit (loss ) to be recognized in each of the three years using the above information. (Leave no cells blank – be certain to enter “0” wherever required. Loss amounts should be indicated with a minus sign.)
2021 2022 2023
Cost incurred during the year $2,600,000 $3,900,000 $3,300,000
Estimated costs to complete as of year-end 5,800,000 3,300,000
2021 2022 2023
Cost incurred during the year $2,600,000 $3,900,000 $4,200,000
Estimated costs to complete as of year-end 5,800,000 4,300,000
2021 2022 2023
Revenue _____________ _____________ _______________
Gross profit (loss) _____________ ______________ _______________
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