Marigold Construction Company began operations on January 1. 2020. During the year, Marigold Construction entered into acontract with Lundquist Corp. to construct a manufacturing facility. At that time, Marigold estimated that it would take 5 years tocomplete the facility at a total cost of $4,501.000. The total contract price for construction of the facility is $6.031,000, During theyear, Marigold incurred $1.083,200 in construction costs related to the construction project. The estimated cost to complete thecontract is $4,332.800. Lundquist Corp. was billed and paid 26% of the contract price.Prepare schedules to compute the amount of gross profit to be recognized for the year ended December 31. 2020, and the amount tobe shown as "costs and recognized proft in excess of billings" or "billings in excess of costs and recognized proft" at December 31.2020, under each of the following methods. (Enter negative amounts using elther a negative sign preceding the number eg 45 orparentheses eg. (45). If answer is 0, please enter 0, Do not leave anry fields blank.)fa) Compieted-contract method.Gross Profit to be recognized Computation of Gross Profit to Be Recognizedunder Percentage-of-Completion MethodTotal Estimated CostEstimated Profit%24Percentace-of CompletionGross ProftEstimated ProfitPercentage-of-Completion21

The following are calculated to prepare the schedule for gross profit to be recognized:- 1.…

Marigold Construction Company began operations on January 1, 2020, During the year, Marigold Construction entered into a contract with Luhdquist Corp. to construct a manufacturing facility. At that time, Marigold estimated that it would take 5 years to complete the facility at a total cost of $4,501.00O. The total contract price for construction of the facility is $6.031.000, During the year, Marigold incurred $1,083,200 in construction costs related to the construction project. The estimated cost to complete the contract is $4,332.800. Lundquist Corp. was billed and paid 26% of the contract price. Prepare schedules to compute the amount of gross proft to be recognized for the year ended December 31. 2020, and the amount to be shown as "costs and recognized pront in excess of billings or "billings in excess of costs and recognized pront" at December 31, 2020, under each of the following methods. (Enter negative amounts using elther a negotive sign preceding the number eg 45 or parentheses eg. (45). Iif answer is 0, please enter 0. Do not leave any fields blank.) (a) Completed-contract method. Gross Profit to be recognized

Marigold Construction Company began operations on January 1, 2020, During the year, Marigold Construction entered into a contract with Luhdquist Corp. to construct a manufacturing facility. At that time, Marigold estimated that it would take 5 years to complete the facility at a total cost of $4,501.00O. The total contract price for construction of the facility is $6.031.000, During the year, Marigold incurred $1,083,200 in construction costs related to the construction project. The estimated cost to complete the contract is $4,332.800. Lundquist Corp. was billed and paid 26% of the contract price. Prepare schedules to compute the amount of gross proft to be recognized for the year ended December 31. 2020, and the amount to be shown as "costs and recognized pront in excess of billings or "billings in excess of costs and recognized pront" at December 31, 2020, under each of the following methods. (Enter negative amounts using elther a negotive sign preceding the number eg 45 or parentheses eg. (45). Iif answer is 0, please enter 0. Do not leave any fields blank.) (a) Completed-contract method. Gross Profit to be recognized

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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