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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 during the year Estimated costs to complete as of year-end Cost incurred during the year Estimated costs to complete as of year-end Billings during the year. Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs incurred). 2-c. In the journal below, complete the necessary journal entries for the year 2026 (credit "Cash, Materials, etc." for construction costs incurred). 3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the contract. 4. 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. $ Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 1,584,000 5,616,000 1,200,000 1,000,000 2024 580,000 5,780,000 2025 $ 3,240,000 2,376,000 3,624,000 2,800,000 2024 $ 2,580,000 5,780,000 2025 $ 3,890,000 3,280,000 2026 $ 2,613,600 2025 $ 3,890,000 4,280,000 5,176,000 6,200,000 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. 2026 $ 3,280,000 0 2026 $ 4,170,000 0

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 during the year Estimated costs to complete as of year-end Cost incurred during the year Estimated costs to complete as of year-end Billings during the year. Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs incurred). 2-c. In the journal below, complete the necessary journal entries for the year 2026 (credit "Cash, Materials, etc." for construction costs incurred). 3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the contract. 4. 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. $ Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 1,584,000 5,616,000 1,200,000 1,000,000 2024 580,000 5,780,000 2025 $ 3,240,000 2,376,000 3,624,000 2,800,000 2024 $ 2,580,000 5,780,000 2025 $ 3,890,000 3,280,000 2026 $ 2,613,600 2025 $ 3,890,000 4,280,000 5,176,000 6,200,000 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. 2026 $ 3,280,000 0 2026 $ 4,170,000 0

FINANCIAL ACCOUNTING
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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Record the construction costs, progress billings, cash collections and gross profit (loss) for 2024, 2025 and 2026.

Req 1 Req 2A Revenue Gross profit (loss) Req 2B Req 2C Req 3 < Req 1 Req 4 Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. Note: Leave no cells blank - be certain to enter "0" wherever required. Loss amounts should be indicated with a minus sign. 2024 2025 2026 Req 5 Req 2A >
Transcribed Image Text:Req 1 Req 2A Revenue Gross profit (loss) Req 2B Req 2C Req 3 < Req 1 Req 4 Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. Note: Leave no cells blank - be certain to enter "0" wherever required. Loss amounts should be indicated with a minus sign. 2024 2025 2026 Req 5 Req 2A >
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 2024 $ 1,584,000 5,616,000 1,200,000 1,000,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs incurred). 2-c. In the journal below, complete the necessary journal entries for the year 2026 (credit "Cash, Materials, etc." for construction costs incurred). 3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the contract. 4. 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. Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 2,580,000 5,780,000 2025 $ 3,240,000 2,376,000 3,624,000 2,800,000 2024 $ 2,580,000 5,780,000 2025 $ 3,890,000 3,280,000 2026 $ 2,613,600 2025 $ 3,890,000 4,280,000 5,176,000 6,200,000 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. 2026 $ 3,280,000 0 2026 $ 4,170,000 0
Transcribed Image Text: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 2024 $ 1,584,000 5,616,000 1,200,000 1,000,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs incurred). 2-c. In the journal below, complete the necessary journal entries for the year 2026 (credit "Cash, Materials, etc." for construction costs incurred). 3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the contract. 4. 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. Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 2,580,000 5,780,000 2025 $ 3,240,000 2,376,000 3,624,000 2,800,000 2024 $ 2,580,000 5,780,000 2025 $ 3,890,000 3,280,000 2026 $ 2,613,600 2025 $ 3,890,000 4,280,000 5,176,000 6,200,000 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. 2026 $ 3,280,000 0 2026 $ 4,170,000 0
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