In February 2018, X-cell Inc. began construction on a commercial building for EastCo which had a contract price of $2,400,000. The construction is scheduled to be completed in May 2020. Contract information for all three years is given below at the company's December 31 year-end. Contract costs incurred during the year Estimated additional costs to complete_ Billings to EastCo during the year Cash collections during year 2018 2019 2020 600,000 1,100,000 500,000 1,500,000 100,000 550,000 1,050,000 800,000 525,000 925,000 950,000 Using the percentage-of-completion method, fill in the incomplete journal entries for X-cell Inc. Please make sure your final answer(s) are accurate to the nearest whole number. Date Account December Construction in progress_ 2018 to 2020 Cash, materials, etc. December Accounts receivable 2018 to 2020 Billings on construction contract December Cash_ 2018 to 2020 Accounts receivable_ December Construction expense. 2018 to 2020 Construction in progress (gross profit). Revenue from long-term contracts. December Billings on construction contract_ 2018 to 2020 Construction in progress_ 2018 2019 2020 Debit Credit Debit Credit Debit Credit

In February 2018, X-cell Inc. began construction on a commercial building for EastCo which had a contract price of $2,400,000. The construction is scheduled to be completed in May 2020. Contract information for all three years is given below at the company's December 31 year-end. Contract costs incurred during the year Estimated additional costs to complete_ Billings to EastCo during the year Cash collections during year 2018 2019 2020 600,000 1,100,000 500,000 1,500,000 100,000 550,000 1,050,000 800,000 525,000 925,000 950,000 Using the percentage-of-completion method, fill in the incomplete journal entries for X-cell Inc. Please make sure your final answer(s) are accurate to the nearest whole number. Date Account December Construction in progress_ 2018 to 2020 Cash, materials, etc. December Accounts receivable 2018 to 2020 Billings on construction contract December Cash_ 2018 to 2020 Accounts receivable_ December Construction expense. 2018 to 2020 Construction in progress (gross profit). Revenue from long-term contracts. December Billings on construction contract_ 2018 to 2020 Construction in progress_ 2018 2019 2020 Debit Credit Debit Credit Debit Credit

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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Vikram
How much is the realized gross profit in 2021?
8. How much is the Gross Profit/Loss Realized in 2018? * Triple Take Construction Co. began construction of a project in 2017 for a contract price of P9,600,000. The project is to be completed in 4 years or in the year 2021. The following are the details regarding the construction project 2017 2018 2019 Costs inenered to dnte Estimsted cost to complete Progess Billings to dnte Cash Collectiona for the year 2160,000 4,500,000 7,520,000 6840,000 5,500,000 1,690, 000 2,304,000 4,320,000 7,680,000 1,728.000 3,240,000 5,760,000 9. How much is the Gross Profit/Loss Realized in 2019? * Xurpas Homes entered into a construction agreement in 2018 for the construction of condominium buildings. The original contract price was P20,000,000 but a change order was issued in 2019 that increases the price by P2,000,000. The percentage of completion method is used by the company in recognizing revenue. The following are information regarding the company. 2018 10,200,000 10,200,000 9,800,000 8,760,000…
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Explain clearly
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 $2,581,000 $2,347,000 $3,049,200 Estimated costs to complete as of year-end 6,319,000 2,772,000 0 Billings during the year 2,090,000 2,838,000 5,072,000 Cash collections during the year 1,845,000 2,900,000 5,255,000 Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the…
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: 2026 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2024 $ 2,624,000 5,576,000 2,200,000 2025 $ 3,690,000 1,886,000 4,114,000 $ 2,074,600 3,686,000 2,000,000 3,800,000 4,200,000 Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 2,420,000 5,620,000 2025 2026 $ 3,810,000 3,120,000 $ 3,220,000 в 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. 2024 2025 2026 Cost incurred during the year Estimated costs to complete as of…
In 2024, KP Building Incorporated began work on a four-year construction project (called Cincy One). The contract price is $460 million. KP recognizes revenue on this contract over time according to percentage of completion. At the end of 2024, the following financial statement information indicates the results to date for Cincy One: INCOME STATEMENT: Gross profit (before-taxes) recognized in 2024 $ 43 million BALANCE SHEET: Accounts receivable from construction billings $ 30 million Construction in progress $ 86 million Less: Billings on construction $ (96 million) Net billings in excess of construction in progress $ 10 million Required: Compute the following, placing your answer in the spaces provided and showing supporting computations below. Note: Round your percentage answer to the nearest whole number. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).
In 2020, Grouper Construction Corp. began construction work under a 3-year contract. The contract price was $1,060,000. Grouper uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2020, are shown below. Balance Sheet Accounts receivable $17,700 Construction in process $68,300 Less: Billings 61,300 Costs and recognized profit in excess of billings 7,000 Income Statement Income (before tax) on the contract recognized in 2020 $16,392 (a) How much cash was collected in 2020 on this contract? Portion of contract billings collected $enter a dollar amount (b) What was the initial estimated total income before tax on this contract? Income before tax on this contract $enter a…
Answer is $1,800,000. Please explain the reasoning and calculations
In 2021, Montana Corp. entered into a contract to begin work on a two-year project. Montana recognizes revenue over time according to percentage of completion for this contract, and provides the following information (dollars in millions): Accounts receivable, 12/31/2021 (from construction progress billings) $37.5 $140 Actual construction costs incurred in 2021 Cash collected on project during 2021 $105 Construction in progress, 12/31/2021 $210 Estimated percentage of completion during 2021 Selected Amounts O $70,000,000 What is the amount of gross profit on the project recognized by Montana during 2021? O $60,000,000 $35,000,000 O $105,000,000 50 %
Marin Furniture started construction of a combination office and warehouse building for its own use at an estimated cost of €4,360,000 on January 1, 2022. Marin expected to complete the building by December 31, 2022. Marin has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2021 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2023 Long-term loan-11% interest, payable on January 1 of each year. Principal payable on January 1, 2026 (a) * Your answer is incorrect. Assume that Marin completed the office and warehouse building on December 31, 2022, as planned at a total cost of €4,628,000. The following expenditures were made during the period forthis project: January 1, €890,000; April 1, €1.290,000; July 1, €1,690,000; and October 1, €560,000. Excess funds from the construction loans were invested during the period and earned €19,600 of…