Required information 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 2021, 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 2023. Information related to the contract is as follows: Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2021 2022 $2,044,000 $2,628,000 5,256,000 2,628,000 2,170,000 1,885,000 2023 $2,890,800 Westgate recognizes revenue over time according to percentage of completion. 0 2,502,000 5,328,000 2,600,000 5,515,000

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Required information
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 2021, 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 2023. Information related to the contract is as follows:
Cost incurred during the year
Estimated costs to complete as of year-end
Billings during the year
Cash collections during the year
Problem 6-10 (Algo) Part 1
Westgate recognizes revenue over time according to percentage of completion.
Revenue
Gross profit (loss)
2021
$2,044,000
5,256,000
2,170,000
1,885,000
X Answer is complete but not entirely correct.
2022
3,600,000 $
$
$
2021
2,800,000 $
756,000 $ 972,000
2022
$2,628,000
2,628,000
2,502,000
2,600,000
Required:
1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. (Do not round intermediate
calculations. Loss amounts should be indicated with a minus sign.)
2023
3,600,000
$ 686,400 X
2023
$2,890,800
0
5,328,000
5,515,000
Transcribed Image Text:Required information 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 2021, 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 2023. Information related to the contract is as follows: Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Problem 6-10 (Algo) Part 1 Westgate recognizes revenue over time according to percentage of completion. Revenue Gross profit (loss) 2021 $2,044,000 5,256,000 2,170,000 1,885,000 X Answer is complete but not entirely correct. 2022 3,600,000 $ $ $ 2021 2,800,000 $ 756,000 $ 972,000 2022 $2,628,000 2,628,000 2,502,000 2,600,000 Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. (Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.) 2023 3,600,000 $ 686,400 X 2023 $2,890,800 0 5,328,000 5,515,000
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