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In February 2023, Wildhorse Construction signed a contract and commenced construction on a parking garage. The total contract price was $91.3 million and was expected to be completed in July 2025 at a total estimated cost of $82.5 million. Payment by the customer was to be made in several stages, based on significant events and dates throughout the construction timeline. Based on the terms of the contract with the customer, control over the parking garage (i.e. ownership) does not transfer to the customer until completion. Wildhorse's year-end was September 30 and follows ASPE. By the end of September, 2023, Wildhorse had incurred $24,750,000 in costs and had invoiced $10,600,000 in progress billings. $8,700,000 of the progress billings had been collected. By September 30, 2024, Wildhorse had incurred $51,220,000 in total costs and had invoiced $46,000,000 in progress billings, including the progress billings in 2023. Of the total billings, $31,100,000 had been collected. Also, Wildhorse reviewed its cost estimates on the project, and now believed the parking garage would cost $78.8 million in total to complete.

In February 2023, Wildhorse Construction signed a contract and commenced construction on a parking garage. The total contract price was $91.3 million and was expected to be completed in July 2025 at a total estimated cost of $82.5 million. Payment by the customer was to be made in several stages, based on significant events and dates throughout the construction timeline. Based on the terms of the contract with the customer, control over the parking garage (i.e. ownership) does not transfer to the customer until completion. Wildhorse's year-end was September 30 and follows ASPE. By the end of September, 2023, Wildhorse had incurred $24,750,000 in costs and had invoiced $10,600,000 in progress billings. $8,700,000 of the progress billings had been collected. By September 30, 2024, Wildhorse had incurred $51,220,000 in total costs and had invoiced $46,000,000 in progress billings, including the progress billings in 2023. Of the total billings, $31,100,000 had been collected. Also, Wildhorse reviewed its cost estimates on the project, and now believed the parking garage would cost $78.8 million in total to complete.

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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In February 2023, Wildhorse Construction signed a contract and commenced construction on a parking garage. The total contract price was $91.3 million and was expected to be completed in July 2025 at a total estimated cost of $82.5 million. Payment by the customer was to be made in several stages, based on significant events and dates throughout the construction timeline. Based on the terms of the contract with the customer, control over the parking garage (i.e. ownership) does not transfer to the customer until completion. Wildhorse's year-end was September 30 and follows ASPE. By the end of September, 2023, Wildhorse had incurred $24,750,000 in costs and had invoiced $10,600,000 in progress billings. $8,700,000 of the progress billings had been collected. By September 30, 2024, Wildhorse had incurred $51,220,000 in total costs and had invoiced $46,000,000 in progress billings, including the progress billings in 2023. Of the total billings, $31,100,000 had been collected. Also, Wildhorse reviewed its cost estimates on the project, and now believed the parking garage would cost $78.8 million in total to complete. (a) Using the completed-contract method, prepare all journal entries required for the year ended September 30, 2023. Use Materials, Cash, Payables for costs incurred to date. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. Account Titles and Explanation 1. 2. 3. (To record the 2023 cost of construction) (To record the 2023 progress billings) (To record the 2023 cash collections) Debit Credit
Transcribed Image Text:In February 2023, Wildhorse Construction signed a contract and commenced construction on a parking garage. The total contract price was $91.3 million and was expected to be completed in July 2025 at a total estimated cost of $82.5 million. Payment by the customer was to be made in several stages, based on significant events and dates throughout the construction timeline. Based on the terms of the contract with the customer, control over the parking garage (i.e. ownership) does not transfer to the customer until completion. Wildhorse's year-end was September 30 and follows ASPE. By the end of September, 2023, Wildhorse had incurred $24,750,000 in costs and had invoiced $10,600,000 in progress billings. $8,700,000 of the progress billings had been collected. By September 30, 2024, Wildhorse had incurred $51,220,000 in total costs and had invoiced $46,000,000 in progress billings, including the progress billings in 2023. Of the total billings, $31,100,000 had been collected. Also, Wildhorse reviewed its cost estimates on the project, and now believed the parking garage would cost $78.8 million in total to complete. (a) Using the completed-contract method, prepare all journal entries required for the year ended September 30, 2023. Use Materials, Cash, Payables for costs incurred to date. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. Account Titles and Explanation 1. 2. 3. (To record the 2023 cost of construction) (To record the 2023 progress billings) (To record the 2023 cash collections) Debit Credit
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