Inexperienced construction company Kevin Corp. signed a risky non-cancellable contract to build a research facility at a fixed contract amount of $2,100,000. The work began in early 2023 and Kevin incurred costs of $945,000. At December 31, 2023, the estimated future costs to complete the project totalled $945,000. During 2024, Kevin ran into trouble with weather conditions and incurred the expected costs of $945,000 and estimated that it would need to spend an additional $310,000 to complete the project. During 2025, Kevin reluctantly completed the project, incurring further costs of $365,000. Prepare the December 31, 2024 year-end journal entry to record any loss from the contract, assuming Kevin uses the completed- contract method. (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 debit entry before credit entry.) Date December 31, 2024 Account Titles and Explanation Debit Credit

Inexperienced construction company Kevin Corp. signed a risky non-cancellable contract to build a research facility at a fixed contract amount of $2,100,000. The work began in early 2023 and Kevin incurred costs of $945,000. At December 31, 2023, the estimated future costs to complete the project totalled $945,000. During 2024, Kevin ran into trouble with weather conditions and incurred the expected costs of $945,000 and estimated that it would need to spend an additional $310,000 to complete the project. During 2025, Kevin reluctantly completed the project, incurring further costs of $365,000. Prepare the December 31, 2024 year-end journal entry to record any loss from the contract, assuming Kevin uses the completed- contract method. (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 debit entry before credit entry.) Date December 31, 2024 Account Titles and Explanation Debit Credit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Alpesh bhaliya
Sodlno
XYZ Co. completed construction of a new silver mine in 2020. The cost of direct materials for the construction was $2,500,000 and direct labour was $2,300,000. In addition, the company allocated $280,000 of general overhead costs to the project. To finance the project, the company obtained a loan of $2,700,000 from its bank. The loan funds were drawn on February 24, 2020 and the mine was completed on November 24, 2020. The interest rate on the loan was 9% p.a. During construction, excess funds from the loan were invested and earned interest income of $24,000. The remainder of the funds needed for construction was drawn from internal cash reserves in the company. The company has also publicly made a commitment to clean up the site of the mine when the extraction operation is complete. It is estimated that the mining of this particular seam will be completed in 13 years, at which time restoration costs of $150,000 will be incurred. The appropriate discount rate for this type of…
On January 1, 2021, X Company bought a machine for $44,000. It's now January 1, 2022, and management is disappointed that 2021 operating costs with the machine were $32,000. Since they are expecting future operating costs to continue to be $32,000 a year, they are considering replacing the machine with a new one. Although the new machine will cost $47,000, operating costs with the new machine will decrease by $8,000 each year. Both machines will last for 4 more years. The current machine can be sold immediately for $8,000 but will have no salvage value at the end of 4 years. The new machine will have a salvage value of $4,000 at the end of 4 years. Assuming a discount rate of 8%, what is the net present value of replacing the current machine with the new one? Submit Answer Tries 0/4
In 2017, Chik-Fil-A signed a contract valued at $900K. It was estimated that $650K would be required to complete the work requested. In 2017, a total of $100K in costs had been accumulated. In 2018, the area in which the work was performed received an unexpected ice storm that knocked out power for two weeks. This caused the total estimated costs to complete the project to increase to $1M due to contingencies placed within the contract. An additional $400K costs was accumulated during 2018. Prepare the journal entries required in 2017 and 2018. with proper Format.
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,810,000. The project was begun in 2023 and completed in 2024. Cost and other data are presented below: 2023 2024 Costs incurred during the year $ 447,000 $ 1,110,000 Estimated costs to complete 1,043,000 0 Billings during the year 405,000 1,405,000 Cash collections during the year 305,000 1,505,000 Assume that Beavis recognizes revenue on this contract over time according to percentage of completion. Required: Prepare all journal entries to record costs, billings, collections, and profit recognition. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Journal entry worksheet
am. 255.
Please help me. Thankyou.
3. A contractor won a bid to repave so many kilometers of a badly damaged concrete road in the south. He is offered a crane-mounted pneumatic breaker which will cost P 1,200,000 with a salvage value of P 150,000 at the end of its estimated life of 15 years. The annual cost of maintenance, taxes, licenses and insurance is 12% of the first cost, regardless of how the equipment is used. The variable cost is P 550 per day. The equipment is capable of breaking 30 sq.m. of 20-centimeter-thick of concrete road per day. Without equipment, two laborers receiving P 50 each per day could break an average of one sq.m. of the same road per day. How many sq.m. of the road per year must the equipment break to make the machine an economical investment? Assume interest on investment to be 12% of the first cost.
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
On January 02, 2021, ACME Incorporated constructed a sea-salt extraction platform and processing plant on the Caribbean Sea for $500,000 cash. The contract runs for 10 years at which time ACME must dismantle the site. The decommissioning and removal costs are estimated at $250,000 and management has publicly announced that it will commit an additional $50,000 to sea-life preservation and study at that time. The company has a December 31 year end and none of the restoration obligation applies to production. An appropriate discount rate for this transaction is 8%. Required: Show your work below each entry and round interim calculations to four decimal places and final answers to the nearest dollar. Assuming that ACME follows ASPE, 1. Prepare all entries related to the site restoration only for 2021 (ignore depletion entries). 2. On January 03, 2023, the restoration obligation was revised and increased by $54,027 (present value of the increase). Prepare the required entry assuming that…