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: 2024 $ 2,291,000 5,609,000 2,110,000 1,855,000 2025 $ 3,555,000 2,054,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Westgate recognizes revenue over time according to percentage of completion. 3,736,000 3,500,000 2026 $ 2,259,400 0 4,154,000 4,645,000
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: 2024 $ 2,291,000 5,609,000 2,110,000 1,855,000 2025 $ 3,555,000 2,054,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Westgate recognizes revenue over time according to percentage of completion. 3,736,000 3,500,000 2026 $ 2,259,400 0 4,154,000 4,645,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information
Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
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:
Problem 6-10 (Algo) Part 4
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Costs incurred during the year
Estimated costs to complete as of year-end
Revenue
Gross profit (loss)
$
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.
2024
2024
$ 2,291,000
5,609,000
2,110,000
1,855,000
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.
2,900,000
2025
2025
$ 3,555,000
2,054,000
3,736,000
3,500,000
2026
2024
$ 2,291,000
5,609,000
2026
$ 2,259,400
2025
$ 3,855,000
3,155,000
4,154,000
4,645,000
0
2026
$ 3,255,000
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc176d2ba-90fa-400e-a5e9-9bf06e84331b%2Fd303d7ba-414c-421d-a9e7-2d5352fa9a82%2Fo3d0n7i_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
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:
Problem 6-10 (Algo) Part 4
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Costs incurred during the year
Estimated costs to complete as of year-end
Revenue
Gross profit (loss)
$
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.
2024
2024
$ 2,291,000
5,609,000
2,110,000
1,855,000
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.
2,900,000
2025
2025
$ 3,555,000
2,054,000
3,736,000
3,500,000
2026
2024
$ 2,291,000
5,609,000
2026
$ 2,259,400
2025
$ 3,855,000
3,155,000
4,154,000
4,645,000
0
2026
$ 3,255,000
0
![Required information
Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
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:
Problem 6-10 (Algo) Part 3
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Balance Sheet (Partial)
Current assets:
Accounts receivable
Construction in progress
Less: Billings
Current liabilities:
CIP in excess of billings
3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the
contract.
Note: Do not round intermediate calculations.
X Answer is not complete.
2024
$ 2,900,000
2,110,000
2024
$ 2,291,000
5,609,000
2,110,000
1,855,000
$ 255,000
790,000
0
2025
$ 3,555,000
2,054,000
3,736,000
3,500,000
2025
$ 7,400,000
1,626,000
$ 491,000
5,774,000
2026
$ 2,259,400
0
0
4,154,000
4,645,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc176d2ba-90fa-400e-a5e9-9bf06e84331b%2Fd303d7ba-414c-421d-a9e7-2d5352fa9a82%2Fvq91ari_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
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:
Problem 6-10 (Algo) Part 3
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Balance Sheet (Partial)
Current assets:
Accounts receivable
Construction in progress
Less: Billings
Current liabilities:
CIP in excess of billings
3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the
contract.
Note: Do not round intermediate calculations.
X Answer is not complete.
2024
$ 2,900,000
2,110,000
2024
$ 2,291,000
5,609,000
2,110,000
1,855,000
$ 255,000
790,000
0
2025
$ 3,555,000
2,054,000
3,736,000
3,500,000
2025
$ 7,400,000
1,626,000
$ 491,000
5,774,000
2026
$ 2,259,400
0
0
4,154,000
4,645,000
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