ter 6 Exercises J pok ant j int 5 ences Exercise 6-19 (Algo) Long-term contract; revenue recognition over time and at a point in time [LO6-9] Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,600,000. The project began in 2021 and was completed in 2022. Data relating to the contract are summarized below: Costs incurred during the year. Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year Complete this question by entering your answers in the tabs below. Required 1 Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming Nortel recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming this project does not qualify for revenue recognition over time. Required 2 Required 3 Required 4 2021 2022 $ 348,000 $1,791,000 1,392,000 476,000 322,000 Choose numerator 0 + 2,124,000 2,278,000 Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time according to percentage of completion. (Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the table below to arrive at your final answer.) Percentages of completion Choose denominator N % complete to date
ter 6 Exercises J pok ant j int 5 ences Exercise 6-19 (Algo) Long-term contract; revenue recognition over time and at a point in time [LO6-9] Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,600,000. The project began in 2021 and was completed in 2022. Data relating to the contract are summarized below: Costs incurred during the year. Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year Complete this question by entering your answers in the tabs below. Required 1 Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming Nortel recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021 assuming this project does not qualify for revenue recognition over time. Required 2 Required 3 Required 4 2021 2022 $ 348,000 $1,791,000 1,392,000 476,000 322,000 Choose numerator 0 + 2,124,000 2,278,000 Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time according to percentage of completion. (Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the table below to arrive at your final answer.) Percentages of completion Choose denominator N % complete to date
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![ter 6 Exercises
1
pok
int
i
int
9
ences
Exercise 6-19 (Algo) Long-term contract; revenue recognition over time and at a point in time [LO6-9]
Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,600,000. The project began in 2021 and
was completed in 2022. Data relating to the contract are summarized below:
Costs incurred during the year.
Estimated costs to complete as of 12/31
Billings during the year.
Cash collections during the year
Complete this question by entering your answers in the tabs below.
Required 1
Required:
1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue
over time according to percentage of completion.
2. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming this project does not qualify
for revenue recognition over time.
3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021
assuming Nortel recognizes revenue over time according to percentage of completion.
4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021
assuming this project does not qualify for revenue recognition over time.
Required 2
Required 3
Required 4
2021
2022
$ 348,000 $1,791,000
1,392,000
476,000
322,000
Choose numerator
0
+
2,124,000
2,278,000
Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time
according to percentage of completion. (Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the
table below to arrive at your final answer.)
Percentages of completion
Choose denominator
-
% complete to date](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb58f52d6-0245-430e-86d7-85726f6ff614%2F8b786054-21e6-4fe1-be98-84c09e4f56c8%2Ftsds73i_processed.jpeg&w=3840&q=75)
Transcribed Image Text:ter 6 Exercises
1
pok
int
i
int
9
ences
Exercise 6-19 (Algo) Long-term contract; revenue recognition over time and at a point in time [LO6-9]
Assume Nortel Networks contracted to provide a customer with Internet infrastructure for $2,600,000. The project began in 2021 and
was completed in 2022. Data relating to the contract are summarized below:
Costs incurred during the year.
Estimated costs to complete as of 12/31
Billings during the year.
Cash collections during the year
Complete this question by entering your answers in the tabs below.
Required 1
Required:
1. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue
over time according to percentage of completion.
2. Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming this project does not qualify
for revenue recognition over time.
3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021
assuming Nortel recognizes revenue over time according to percentage of completion.
4. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2021
assuming this project does not qualify for revenue recognition over time.
Required 2
Required 3
Required 4
2021
2022
$ 348,000 $1,791,000
1,392,000
476,000
322,000
Choose numerator
0
+
2,124,000
2,278,000
Compute the amount of revenue and gross profit or loss to be recognized in 2021 and 2022 assuming Nortel recognizes revenue over time
according to percentage of completion. (Loss amounts should be indicated with a minus sign. Use percentages as calculated and rounded in the
table below to arrive at your final answer.)
Percentages of completion
Choose denominator
-
% complete to date
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