Problem 4On March 1, 2022, AGGREGATES Company enters a contract to build a hotel whichis estimated tocostP31,200,000.The company recognizes constructionrevenue over time.Data on this project for 2022-2024 follow:ContractCostsEst'd CostsBillingsincurredto Complete20,540,000202210,500,00012,500,00014,440,0005,460,0009,984,00015,756,000202313,156,0002024The contract contains a penalty clause that penalizes the company a reductionof P70,000 from the contract price for every week of delay.contract was delayed for 8 weeksIn 2024, theWhat is the gross profit for 2024?1,164,0001,466,400A.C.1,724,000в.D.1,824,000PIS

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Problem 4 On March 1, 2022, AGGREGATES Company enters a contract to build a hotel which is estimated to cost P31,200,000. The company recognizes construction revenue over time. Data on this project for 2022-2024 follow: Est'd Costs Contract Costs incurred 5,460,000 9,984,000 15,756,000 Billings 10,500,000 to Complete 20,540,000 2022 2023 12,500,000 14,440,000 13,156,000 2024 The contract contains a penalty clause that penalizes the company a reduction of P70,000 from the contract price for every week of delay. In 2024, the contract was delayed for 8 weeks What is the gross profit for 2024? A. 1,164,000 B. 1,466,400 c. 1,724,000 D. 1,824,000

Problem 4 On March 1, 2022, AGGREGATES Company enters a contract to build a hotel which is estimated to cost P31,200,000. The company recognizes construction revenue over time. Data on this project for 2022-2024 follow: Est'd Costs Contract Costs incurred 5,460,000 9,984,000 15,756,000 Billings 10,500,000 to Complete 20,540,000 2022 2023 12,500,000 14,440,000 13,156,000 2024 The contract contains a penalty clause that penalizes the company a reduction of P70,000 from the contract price for every week of delay. In 2024, the contract was delayed for 8 weeks What is the gross profit for 2024? A. 1,164,000 B. 1,466,400 c. 1,724,000 D. 1,824,000

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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In 2021, 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 2023. Information related to the contract is as follows: 2021 2022 2023 Cost incurred during the year $ 2,100,000 $ 2,450,000 $ 2,695,000 Estimated costs to complete as of year-end 4,900,000 2,450,000 0 Billings during the year 2,200,000 2,350,000 5,450,000 Cash collections during the year 1,900,000 2,300,000 5,800,000 Westgate recognizes revenue over time according to percentage of completion. 2-a. In the journal below, complete the necessary journal entries for the year 2021 (credit "Various accounts" for construction costs incurred).2-b. In the journal below, complete the necessary journal entries for the year 2022 (credit "Various accounts" for construction costs incurred).2-c. In the journal below, complete the necessary journal entries for the year 2023…
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