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Q3 Archer Construction Company began work on a $420,000 construction contract in 2015. During 2015, Archer incurred costs of $278,000, billed its customer for $215,000, and collected $175,000. At December 31, 2015, the estimated future costs to complete the project total $162,000. Prepare Archer's journal entry to record profit or loss, if any, using (a) the percentage-of-completion method and (b) the cost-recovery method.

Q3 Archer Construction Company began work on a $420,000 construction contract in 2015. During 2015, Archer incurred costs of $278,000, billed its customer for $215,000, and collected $175,000. At December 31, 2015, the estimated future costs to complete the project total $162,000. Prepare Archer's journal entry to record profit or loss, if any, using (a) the percentage-of-completion method and (b) the cost-recovery method.

FINANCIAL ACCOUNTING
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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Q3 Archer Construction Company began work on a $420,000 construction contract in 2015. During 2015, Archer incurred costs of $278,000, billed its customer for $215,000, and collected $175,000. At December 31, 2015, the estimated future costs to complete the project total $162,000. Prepare Archer's journal entry to record profit or loss, if any, using (a) the percentage-of-completion method and (b) the cost-recovery method.
Transcribed Image Text:Q3 Archer Construction Company began work on a $420,000 construction contract in 2015. During 2015, Archer incurred costs of $278,000, billed its customer for $215,000, and collected $175,000. At December 31, 2015, the estimated future costs to complete the project total $162,000. Prepare Archer's journal entry to record profit or loss, if any, using (a) the percentage-of-completion method and (b) the cost-recovery method.
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