Kylie Builders Inc. is building a new home for Cassie Proffit at a contracted price of $200,000. The estimated cost at the time the contract is signed (January 2, 2015) is $115,000. At December 31, 2015, the total cost incurred is $60,000 with estimated costs to complete of $59,000. Kylie has billed $80,000 on the job and has received a $55,000 payment. This is the only contract in process at year-end. Prepare the sections of the balance sheet and the income statement of Kylie Builders Inc. affected by these events assuming use of (1) the percentage-of-completion method and (2) the completed-contract method. (Note: Round percentage to two decimal places for percentage completed.)
Kylie Builders Inc. is building a new home for Cassie Proffit at a contracted price of $200,000. The estimated cost at the time the contract is signed (January 2, 2015) is $115,000. At December 31, 2015, the total cost incurred is $60,000 with estimated costs to complete of $59,000. Kylie has billed $80,000 on the job and has received a $55,000 payment. This is the only contract in process at year-end. Prepare the sections of the balance sheet and the income statement of Kylie Builders Inc. affected by these events assuming use of (1) the percentage-of-completion method and (2) the completed-contract method. (Note: Round percentage to two decimal places for percentage completed.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Kylie Builders Inc. is building a new home for Cassie Proffit at a contracted price of $200,000. The estimated cost at the time the contract is signed (January 2, 2015) is $115,000. At December 31, 2015, the total cost incurred is $60,000 with estimated costs to complete of $59,000. Kylie has billed $80,000 on the job and has received a $55,000 payment. This is the only contract in process at year-end. Prepare the sections of the
- (1)
the percentage-of-completion method and
- (2)
the completed-contract method.
(Note: Round percentage to two decimal places for percentage completed.)
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