Puff and Stuff Construction began a construction project in 2016. The contract price was $1,300,000 and estimated costs were $1,100,000. Data for each year follow: 2016 2017 2018 Costs incurred during the year $ 250,000 $ 600,000 $ 210,000 Estimated costs to complete $ 850,000 $ 230,000 $ - Partial billings $ 400,000 $ 600,000 $ 300,000 Collections $ 385,000 $ 610,000 $ 305,000 Required: Assuming Puff satisfies its performance obligation over time, determine: 1. The balance of Construction in Progress at the end of 2016. 2. How the net amount for construction in progress inventory should be reported on the 2017 balance sheet. 3. The gross profit for 2018.
Puff and Stuff Construction began a construction project in 2016. The contract price was $1,300,000 and estimated costs were $1,100,000. Data for each year follow: 2016 2017 2018 Costs incurred during the year $ 250,000 $ 600,000 $ 210,000 Estimated costs to complete $ 850,000 $ 230,000 $ - Partial billings $ 400,000 $ 600,000 $ 300,000 Collections $ 385,000 $ 610,000 $ 305,000 Required: Assuming Puff satisfies its performance obligation over time, determine: 1. The balance of Construction in Progress at the end of 2016. 2. How the net amount for construction in progress inventory should be reported on the 2017 balance sheet. 3. The gross profit for 2018.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
| Puff and Stuff Construction began a construction project in 2016. | ||||||
| The contract price was $1,300,000 and estimated costs were $1,100,000. | ||||||
| Data for each year follow: | ||||||
| 2016 | 2017 | 2018 | ||||
| Costs incurred during the year | $ 250,000 | $ 600,000 | $ 210,000 | |||
| Estimated costs to complete | $ 850,000 | $ 230,000 | $ - | |||
| Partial billings | $ 400,000 | $ 600,000 | $ 300,000 | |||
| Collections | $ 385,000 | $ 610,000 | $ 305,000 | |||
| Required: | ||||||
| Assuming Puff satisfies its performance obligation over time, determine: | ||||||
| 1. The balance of Construction in Progress at the end of 2016. | ||||||
| 2. How the net amount for construction in progress inventory should be reported on the 2017 |
||||||
| 3. The gross profit for 2018. |
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