Crevar constructs residential properties for clients and reports income by the percentage of completion method. In 2019, Crevar started a P2,000,000 construction contract. Details of his 2019 and 2020 construction follow: 20192020Annual construction costsP200,000 P800,000Estimated cost to finish800,000250,000Extent of completion20%80%Compute the construction income in 2019 and 2020.P200,000;P560,000P400,000;P400,000P200,000;P400,000P400,000;P560,000

Profit on incomplete contract: At the end of an accounting period, it may be found that certain…

Answered: reports income by the percentage of…

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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On February 1, 2023, Sandhill Contractors agreed to construct a building at a contract price of $3,460,000. The total estimated construction costs would be $1,890,000 and the project would be finished in 2025. Information relating to the costs and billings for this contract is as follows: Total costs incurred to date Estimated costs to complete Customer billings to date Collections to date 2023 Gross profit/ (loss) 689,850 1,200,150 1,100,000 1,000,000 2023 2024 573050 $1,162,000 $ 2,365,000 913,000 1,890,000 1,750,000 2025 Calculate the gross profit / (loss) that should be recognized for 2023, 2024, and 2025 using the percentage completion method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round percentage complete to 1 decimal place, e.g. 15.2% and final answers to O decimal places, e.g. 5,125.) 2024 -0- 3,460,000 2,950,000 -107450 $ LA 2025 40450
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Manson Construction Corp. has consistently used the percentage-of-completion method. In 2020, Manson started work on a $10,500,000 construction contract that was completed in 2021. The following information was taken from Manson’s 2020 accounting records: Billings to date $3,300,000 Costs incurred 3,150,000 Collections to date 2,100,000 Estimated costs to complete 6,300,000 What is the amount of revenue that will be recorded in 2020? In 2020, Pop Construction Corp. began work on a contract for $ 3,700,000. Other details follow: 2020 Costs incurred during the year.................................................................... $ 1,800,000 Estimated costs to complete as of December 31................................... 1,200,000 Billings during the year................................................................................. 1,650,000 Collections during the…

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	2019	2020
Annual construction costs	P200,000	P800,000
Estimated cost to finish	800,000	250,000
Extent of completion	20%	80%

reports income by the percentage of completion method. In 2019, Crevar started a P2,000,000 construction contract. Details of his 2019 and 2020 construction follow: 2019 2020 Annual construction costs P200,000 P800,000 Estimated cost to finish 800,000