Pumpkin Company has contracted to build for the city of Peoria a new school. The estimated cost is $7,000,000 and the contract price is $10,000,000. The school took three years to complete as follows: Costs to Date Costs to Complete Amounts Billed to Date Collections to Date 2025 $3,500,000 $3,500,000 2026 $5,250,000 $2,000,000 2027 $3,300,000 $1,300,000 $5,300,000 $7,250,000 $0 $6,700,000 $10,000,000 $10,000,000 Determine using the percentage of completion method the gross profit to be recognized for: 2025 2027 2026 Determine using the Cost Plus or completed contract method the gross profit to be recognized for : 2025 2026 2027
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- 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: 2024 2025 2026 Cost incurred during the year $ 2,100,000 $ 3,150,000 $ 2,475,000 Estimated costs to complete as of year-end 5,400,000 2,250,000 0 Billings during the year 2,150,000 3,100,000 4,750,000 Cash collections during the year 1,875,000 3,100,000 5,025,000 Westgate recognizes revenue over time according to percentage of completion. 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years.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: 2024 2025 2026 Cost incurred during the year $ 2,100,000 $ 3,150,000 $ 2,475,000 Estimated costs to complete as of year-end 5,400,000 2,250,000 0 Billings during the year 2,150,000 3,100,000 4,750,000 Cash collections during the year 1,875,000 3,100,000 5,025,000 Westgate recognizes revenue over time according to percentage of completion. 2024 2025 2026 Costs incurred during the year $ 2,100,000 $ 3,875,000 $ 3,275,000 Estimated costs to complete as of year-end 5,400,000 3,175,000 0 1. 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.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: 2024 2025 2026 Cost incurred during the year $ 2,100,000 $ 3,150,000 $ 2,475,000 Estimated costs to complete as of year-end 5,400,000 2,250,000 0 Billings during the year 2,150,000 3,100,000 4,750,000 Cash collections during the year 1,875,000 3,100,000 5,025,000 Westgate recognizes revenue over time according to percentage of completion. 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. Note: Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.
- Venus' Venerable Construction contracts to lay marble in a new museum over a three-year period, and the project is considered to be a single performance obligation. The company's accountants record the following details relating to the project: Contract details: Contract price Year Revenue Expense Income Estimated cost Estimated profit $1,500 $1,200 $300 Spending pattern during construction: Year 1 1 [R1] [E1] [11] Year 2 Year 3 $300 Answer the following question(s) by filling in the blanks. Do not include any symbols besides decimals in your answers (do not input commas). $750 Compute the amount of revenue, expense, and income for each year assuming that its performance obligation is fulfilled over time and that the costs it incurs are reflective of the value conveyed to the customer. 2 [R2] [E2] [12] $150 3 [R3] [E3] [13] Venus' Venerable Construction contracts to lay marble in a new museum over a three-year period, and the project is considered to be a single performance obligation.…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: 2024 2025 2026 Cost incurred during the year $ 2,184,000 $3,510,000 $2,316, 600 Estimated costs to complete as of year-end 5,616,000 2,106, 000 0 Billings during the year 1,800,000 3,894,000 4,306, 000 Cash collections during the year 1,600,000 3,400,000 5,000,000 Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit" Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs…An Engineer makes the following cost estimates for each: A: Concrete Bleachers: First cost, $350,000. Life, 90 years. Annual upkeep costs $2000. B: Wooden Bleachers: The first-year cost for of the project includes ground preparation, painting, seats, and bleachers. Painting costs $10,000 every three years. seats cost $40,000 every 15 years. bleachers cost $100,000 every 30 years. Ground preparation is $50,000 and, will last the entire 90-year period. Given i=7%: For B: The annual cost of Ground prep is __? The total annual cost of B is about? The annual cost of seats is about__? What is the annual cost of A?
- 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: 2024 2025 2026 Cost incurred during the year $ 3,471,000 $ 4,005,000 $ 1,566,400 Estimated costs to complete as of year-end 5,429,000 1,424,000 0 Billings during the year 2,900,000 4,576,000 2,524,000 Cash collections during the year 2,700,000 4,500,000 2,800,000 Assume that Westgate Construction’s contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit “Cash, Materials, etc.” for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit “Cash, Materials, etc.” for…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: 2024 2025 2026 Cost incurred during the year $ 2,604,000 $ 4,032,000 $ 1,940,400 Estimated costs to complete as of year-end 5,796,000 1,764,000 0 Billings during the year 2,040,000 4,596,000 3,364,000 Cash collections during the year 1,820,000 4,000,000 4,180,000 Westgate recognizes revenue over time according to percentage of completion. 3. Complete the information required below to prepare a partial balance sheet for 2024 and 2025 showing any items related to the contract. Note: Do not round intermediate calculations.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: 2024 2025 2026 Cost incurred during the year $ 2,490,000 $ 3,984,000 $ 2,008,600 Estimated costs to complete as of year-end 5,810,000 1,826,000 0 Billings during the year 2,030,000 4,444,000 3,526,000 Cash collections during the year 1,815,000 3,900,000 4,285,000 Westgate recognizes revenue over time according to percentage of completion. 4. 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.
- Shanahan Construction Company has entered into a contract beginning January 1, 2020, to build a parking complex. It has been estimated that the complex will cost $609,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $896,000. The following data pertain to the construction period. 2020 2021 2022 Costs to date $266,640 $412,080 $617,000 Estimated costs to complete 339,360 193,9200 –0– Progress billings to date 270,000 545,000 896,000 Cash collected to date 240,000 495,000 896,000 A/ Using the percentage-of-completion method, compute the estimated gross profit that would be recognized during each year of the construction period. Gross profit recognized in 2020: Gross profit recognized in 2021: Gross profit recognized in 2022: B/ Using the completed-contract method, compute the estimated gross profit that would be recognized during each year of the construction period. Gross profit recognized in 2020: Gross profit recognized in 2021: Gross…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: 2024 2025 2026 Cost incurred during the year $ 1,584,000 $ 3,240,000 $ 2,613,600 Estimated costs to complete as of year-end 5,616,000 2,376,000 0 Billings during the year 1,200,000 3,624,000 5,176,000 Cash collections during the year 1,000,000 2,800,000 6,200,000 Assume that Westgate Construction’s contract with Santa Clara County does not qualify for revenue recognition over time. 1. 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. 2024 2025 2026 Cost incurred during the year $ 2,580,000 $ 3,890,000 $ 3,280,000 Estimated costs to complete as of year-end 5,780,000 3,280,000 0 2. Calculate the amount of revenue and gross…TO REMEDY THE TRAFFIC SITUATION AT A BUSY INTERSECTION IN QUEZON CITY, TWO PLANS ARE BEINGCONSIDERED:PLAN AIS TO BUILD A COMPLETE CLOVER-LEAF COSTING P 9,200,000.00 WHICH WOULD PROVIDE FOR ALL NEEDSDURING THE NEXT 30 YEARS. MAINTENANCE COSTS ARE ESTIMATED TO BE P 2,000.00 A MONTH FOR THE FIRST15 YEARS AND P 3,500.00 A MONTH FOR THE SECOND 15 YEARS.PLAN BIS TO BUILD A PARTIAL CLOVER-LEAF AT A COST OF P 6,500,000.00 WHICH WOULD BE SUFFICIENT FOR THENEXT 15 YEARS. AT THE END OF 15 YEARS, THE CLOVER-LEAF WILL BE COMPLETED AT AN ESTIMATED COSTOF P 7,500,000.00. MAINTENANCE WOULD COST P 1,400.00 A MONTH DURING THE FIRST 15 YEARS AND P 3,500.00A MONTH FOR THE SECOND 15 YEARS.IF MONEY IS WORTH 8%, WHICH OF THE TWO PLANS WOULD YOU RECOMMEND? USE PRESENT WORTH OFCOST METHOD.