On January 1, 2016, AVIDA was contracted to construct a townhouse for SM Corp. for a total contractprice of P50,400,000. The building was completed by November 31, 2018. The following are the dataof AVIDA:201620172018Contract cost incurred during the19,200,00015,600,000 8,700,000yearEstimated cost at completion38,400,00043,500,000 43,500,000Billing during the year19,200,00021,000,000 10,200,000The entry to record the recognized profit in 2018 includes credit toO CIP 1,380,000Contract revenue 10,080,000O CIP 50,400,000Contract cost 8,700,000

Contract price =5,04,00,000 Particulars 2016 2017 2018 Total Cost 1,92,00,000…

Answered: On January 1, 2016, AVIDA was…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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A quantity of steel in the amount of $423,000.0 is needed for a project, payment due (from contractor to steel fabricator) at the project begin date. The steel is expected to be erected in Month 2 and Month 3, with billing at the end of these months and subsequent payment from the owner (to the contractor) at the end of Month 3 and Month 4. Assume half the the payment occurs at the end of Month 3 and the other half at the end of Month 4. Using an annual interest rate of 18%, which is a monthly interest rate of 1.5%, to finance the purchase with a short-term line of credit loan, determine the total interest accumulated for this steel purchase until payment is received (from the owner).
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During 2020, Grouper Company started a construction job with a contract price of $1,590,000. The job was completed in 2022. The following information is available. 2020 2021 2022 Costs incurred to date $370,000 $869,790 $1,080,000 Estimated costs to complete 630,000 231,210 –0– Billings to date 302,000 900,000 1,590,000 Collections to date 267,000 804,000 1,415,000 (a) Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used. Gross profit recognized in 2020 $enter a dollar amount Gross profit recognized in 2021 $enter a dollar amount Gross profit recognized in 2022 $enter a dollar amount
Current Attempt in Progress Flounder, Inc. began work on a $6,504,000 contract in 2020 construct an office building. During 2020, Flounder, Inc. incurred costs of $1,639,900, billed its customers for $1,300,000, and collected $1,055,000. At December 31, 2020, the estimated additional costs to complete the project total $3,650,100. Prepare Flounder's 2020 journal entries using the percentage-of-completion method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For costs incurred use account Materials, Cash, Payables. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Account Titles and Explanation (To record costs incurred.) (To record billings.) (To record collections.) (To recognize revenue.) eTextbook and Media List of Accounts Save for Later Debit Credit Attempts: 0 of 3 used Submit Answer
ABC Co. started work on an P8,000,000 fixed-price construction contract in 20x1. Information on the contract is as follows: 20x2 20x1 2,850,000 3,670,000 Costs incurred per year Estimated costs to complete 4,275,000 1,630,000 How much profit (loss) is recognized in 20x2?
Problem on long-term construction Axcel Construction Company has consistently used the percentage of completion method of recognizing income. During 2020, Axcel entered into a fixed price contract to construct an office building for P10,000,000. Information relating to the contract is as follows: 12/31/2020 12/31/2021 Percentage of completion 25% 65% Estimated total cost at completion-- P7,500,000.00 P 8,000,000.00 Income recognized (cumulative) 500,000.00 1,200,000.00 Required: a. Cost incurred to date, 12/31/2020 b. Cost incurred to date, 12/31/2021 Contract costs incurred during 2021| C.
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5. In 2020, Lalli Corporation incurred R&D costs as follows: Materials and equipment P100,000 Personnel 100,000 Indirect costs 50,000 P250,000 These cost relate to a product that will be marketed in 2021. The Company estimates that these costs will be recouped by December 31, 2024. Required What is the amount of R&D costs expense in 2020?
On January 1, 2022, Winter Harvest Ltd. started a construction project for $4,500,000. Relevant data for 2022 and 2023 are as follows: 2022 2023 Current year construction costs $ 3,300,000 $ 620, 000 Estimated remaining costs to complete 600,000 - 0- Current year billings 3, 100, 000 1,400,000 Current year collections 3,000,000 1,500, 000 Required 1. Calculate the following amounts for each method: 2. Completed Contract Percentage of Completion 2022 2023 2022 2023 Gross Profit $ ? $ ? $ ? $ ? Construction in progress year - end balance. $ ? $ ? $ ? $ ? Costs in excess of billi\table[[, \table[[Completed], [Contract]], \table[[Percentage of], [Completion]]], [, 2022, 2023, 2022, 2023], [Gross Profit,$?, $?, $ ?, $?ngs (Billings in excess of costs) $ ? $ ? $ ? $ ?
Subject: AFAR #41

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