Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9] [The following information applies to the questions displayed below.] In 2024, 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 2026. Information related to the contract is as follows: Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 2,610,000 6,390,000 2,100,000 2025 2026 $ 3,162,000 $ 2,230,800 2,028,000 0 3,672,000 1,850,000 3,000,000 4,228,000 5,150,000 Billings during the year Cash collections during the year Westgate recognizes revenue over time according to percentage of completion. Problem 6-10 (Algo) Part 5 5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs incurred and costs to complete information. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign. Costs incurred during the year Estimated costs to complete as of year-end 2024 2025 2026 $ 2,610,000 6,390,000 $ 3,850,000 4,200,000 $ 4,050,000 0 Answer is complete but not entirely correct. 2024 2025 2026 Revenue $ 2,900,000 $ Gross profit (loss) $ 290,000 $ 3,160,000 (690,000) $ 3,940,000 $ (110,000) x
Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9] [The following information applies to the questions displayed below.] In 2024, 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 2026. Information related to the contract is as follows: Cost incurred during the year Estimated costs to complete as of year-end 2024 $ 2,610,000 6,390,000 2,100,000 2025 2026 $ 3,162,000 $ 2,230,800 2,028,000 0 3,672,000 1,850,000 3,000,000 4,228,000 5,150,000 Billings during the year Cash collections during the year Westgate recognizes revenue over time according to percentage of completion. Problem 6-10 (Algo) Part 5 5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs incurred and costs to complete information. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign. Costs incurred during the year Estimated costs to complete as of year-end 2024 2025 2026 $ 2,610,000 6,390,000 $ 3,850,000 4,200,000 $ 4,050,000 0 Answer is complete but not entirely correct. 2024 2025 2026 Revenue $ 2,900,000 $ Gross profit (loss) $ 290,000 $ 3,160,000 (690,000) $ 3,940,000 $ (110,000) x
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
In 2024, 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 2026. Information related to the contract is as follows:
Cost incurred during the year
Estimated costs to complete as of year-end
2024
$ 2,610,000
6,390,000
2,100,000
2025
2026
$ 3,162,000
$ 2,230,800
2,028,000
0
3,672,000
1,850,000
3,000,000
4,228,000
5,150,000
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Problem 6-10 (Algo) Part 5
5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs
incurred and costs to complete information.
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.
Costs incurred during the year
Estimated costs to complete as of year-end
2024
2025
2026
$ 2,610,000
6,390,000
$ 3,850,000
4,200,000
$ 4,050,000
0
Answer is complete but not entirely correct.
2024
2025
2026
Revenue
$
2,900,000
$
Gross profit (loss)
$
290,000 $
3,160,000
(690,000)
$
3,940,000
$
(110,000) x](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F781ef419-9bb6-4039-a05c-04a5e8a9a026%2F0e8f6c78-91b0-43f6-a666-c249a6777c7c%2F7eekcxn_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 6-10 (Algo) Long-term contract; revenue recognition over time [LO6-8, 6-9]
[The following information applies to the questions displayed below.]
In 2024, 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 2026. Information related to the contract is as follows:
Cost incurred during the year
Estimated costs to complete as of year-end
2024
$ 2,610,000
6,390,000
2,100,000
2025
2026
$ 3,162,000
$ 2,230,800
2,028,000
0
3,672,000
1,850,000
3,000,000
4,228,000
5,150,000
Billings during the year
Cash collections during the year
Westgate recognizes revenue over time according to percentage of completion.
Problem 6-10 (Algo) Part 5
5. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years, assuming the following costs
incurred and costs to complete information.
Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.
Costs incurred during the year
Estimated costs to complete as of year-end
2024
2025
2026
$ 2,610,000
6,390,000
$ 3,850,000
4,200,000
$ 4,050,000
0
Answer is complete but not entirely correct.
2024
2025
2026
Revenue
$
2,900,000
$
Gross profit (loss)
$
290,000 $
3,160,000
(690,000)
$
3,940,000
$
(110,000) x
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