P18-3 (Recognition of Profit and Entries on Long-Term Contract) On March 1, 2010, Chance Company entered into a contract to build an apartment building. It is estimated that the building will cost $2,000,000 and will take 3 years to complete. The contract price was $3,000,000. The following information pertains to the construction period: 2010 2011 2012Costs to date: $600,000 $1,560,000 $2,100,000Estimated costs to complete: 1,400,000 520,000 OProgress billing to date: 1,050,000 2,000,000 3,000,000Cash collected to date: 950,000 1,950,000 2,850,000 Instructions (c) Prepare a partial balance sheet for December 31, 2011, showing the balances in the receivables and inventory accounts.
P18-3 (Recognition of Profit and Entries on Long-Term Contract) On March 1, 2010, Chance Company entered into a contract to build an apartment building. It is estimated that the building will cost $2,000,000 and will take 3 years to complete. The contract price was $3,000,000. The following information pertains to the construction period: 2010 2011 2012Costs to date: $600,000 $1,560,000 $2,100,000Estimated costs to complete: 1,400,000 520,000 OProgress billing to date: 1,050,000 2,000,000 3,000,000Cash collected to date: 950,000 1,950,000 2,850,000 Instructions (c) Prepare a partial balance sheet for December 31, 2011, showing the balances in the receivables and inventory accounts.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:P18-3 (Recognition of Profit and Entries on Long-Term Contract) On March 1, 2010, Chance
Company entered into a contract to build an apartment building. It is estimated that the building
will cost $2,000,000 and will take 3 years to complete. The contract price was $3,000,000. The
following information pertains to the construction period: 2010 2011 2012Costs to date: $600,000
$1,560,000 $2,100,000Estimated costs to complete: 1,400,000 520,000 OProgress billing to date:
1,050,000 2,000,000 3,000,000Cash collected to date: 950,000 1,950,000 2,850,000 Instructions
(c) Prepare a partial balance sheet for December 31, 2011, showing the balances in the receivables
and inventory accounts.
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