2022 $ 350,000 Kailey Construction accepted a three-year, $1,000,000 fixed fee contract to renovate a parking deck. Kailey uses the percentage of completion method and the cost-to-cost method of measuring progress. Information related to the construction contract follows: Actual construction costs incurred during the year 2023 2024 $525,000 $ 50,000 Construction costs incurred in prior years 0 350,000 875,000 Cumulative construction costs incurred to date 350,000 875,000 925,000 Estimated costs to complete 450,000 25,000 0 Estimated total costs 800,000 900,000 925,000 Progress billings made during the year 500,000 300,000 200,000 Cash collections during the year 400,000 350,000 250,000 Required: a. Calculate the percentage of completion, revenues and gross profits recognized for each year. b. Prepare the journal entries required for each year to record the contract. Show all supporting computations. c. Prepare partial balance sheet for 2022 and 2023.
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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: 2024 2025 2026 Cost incurred during the year $ 3,471,000 $ 4,005,000 $ 1,566,400 Estimated costs to complete as of year-end 5,429,000 1,424,000 0 Billings during the year 2,900,000 4,576,000 2,524,000 Cash collections during the year 2,700,000 4,500,000 2,800,000 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.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 2025 2026 Cost incurred during the year $ 3,471,000 $ 4,005,000 $ 1,566,400 Estimated costs to complete as of year-end 5,429,000 1,424,000 0 Billings during the year 2,900,000 4,576,000 2,524,000 Cash collections during the year 2,700,000 4,500,000 2,800,000 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…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 2025 2026 Cost incurred during the year $ 2,604,000 $ 4,032,000 $ 1,940,400 Estimated costs to complete as of year-end 5,796,000 1,764,000 0 Billings during the year 2,040,000 4,596,000 3,364,000 Cash collections during the year 1,820,000 4,000,000 4,180,000 Westgate recognizes revenue over time according to percentage of completion. 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.
- 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 2025 2026 Cost incurred during the year $ 2,490,000 $ 3,984,000 $ 2,008,600 Estimated costs to complete as of year-end 5,810,000 1,826,000 0 Billings during the year 2,030,000 4,444,000 3,526,000 Cash collections during the year 1,815,000 3,900,000 4,285,000 Westgate recognizes revenue over time according to percentage of completion. 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.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 2025 2026 Cost incurred during the year $ 1,584,000 $ 3,240,000 $ 2,613,600 Estimated costs to complete as of year-end 5,616,000 2,376,000 0 Billings during the year 1,200,000 3,624,000 5,176,000 Cash collections during the year 1,000,000 2,800,000 6,200,000 Assume that Westgate Construction’s contract with Santa Clara County does not qualify for revenue recognition over time. 1. 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 $ 2,580,000 $ 3,890,000 $ 3,280,000 Estimated costs to complete as of year-end 5,780,000 3,280,000 0 2. Calculate the amount of revenue and gross…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 2025 2026 Cost incurred during the year $ 2,523,000 $ 3,177,000 $ 1,980,000 Estimated costs to complete as of year-end 6,177,000 1,800,000 0 Billings during the year 2,070,000 3,630,000 4,300,000 Cash collections during the year 1,835,000 3,400,000 4,765,000 Westgate recognizes revenue over time according to percentage of completion. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. Note: Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.
- 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 2025 2026 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year $ 2,542,000 5,658,000 $ 3,772,000 $ 2,074,600 1,886,000 0 2,020,000 4,294,000 Cash collections during the year 1,810,000 3,800,000 3,686,000 4,390,000 Westgate recognizes revenue over time according to percentage of completion. 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. 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. Costs incurred during the year Estimated costs to complete as of year-end Revenue Gross profit (loss) 2024…Required information Skip to question [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: 2024 2025 2026 Cost incurred during the year $ 2,059, 000 $ 2,627,000 $ 2,655,400 Estimated costs to complete as of year - end 5, 041, 000 2,414, 000 0 Billings during the year 2, 190, 000 2, 496,000 5, 314,000 Cash collections during the year 1,895,000 2,400,000 5, 705, 000 Westgate recognizes revenue over time according to percentage of completion. 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…Required information Skip to question [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: 2024 2025 2026 Cost incurred during the year $ 2,016,000 $2,808,000 $2,613,600 Estimated costs to complete as of year-end 5, 184,000 2,376, 000 0 Billings during the year 2, 180,000 2,644,000 5, 176,000 Cash collections during the year 1,890,000 2,500,000 5,610,000 Westgate recognizes revenue over time according to percentage of completion. 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…
- 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 2025 2026 Cost incurred during the year $ 2,184,000 $3,510,000 $2,316, 600 Estimated costs to complete as of year-end 5,616,000 2,106, 000 0 Billings during the year 1,800,000 3,894,000 4,306, 000 Cash collections during the year 1,600,000 3,400,000 5,000,000 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…Required information [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: 2024 2025 2026 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year $ 2,542,000 5,658,000 2,020,000 $ 3,772,000 1,886,000 4,294,000 $ 2,074,600 0 Cash collections during the year 1,810,000 3,800,000 3,686,000 4,390,000 Westgate recognizes revenue over time according to percentage of completion. 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…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 2025 2026 Cost incurred during the year $ 2,100,000 $ 3,150,000 $ 2,475,000 Estimated costs to complete as of year-end 5,400,000 2,250,000 0 Billings during the year 2,150,000 3,100,000 4,750,000 Cash collections during the year 1,875,000 3,100,000 5,025,000 Westgate recognizes revenue over time according to percentage of completion. 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years.