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VI - Methods of Construction Accounting 2eck Construction Company bęgan work on a new building project on January 1, 20x4. The Dvect is to be completed by December 31, 20x6, for a fixed price of P108 million. The following prehe actual costs incurred and estimates of remaining costs to complete the project that were made by Beck's accounting staff: Actual Costs incurred in each year Estimated remaining costs to complete the project measured at Dec. 31 of each year) Years 20x4 20x5 20x6 P30,000,000 P45,000,000 P35,000,000 P60,000,000 P45,000,000 PO Required: 1. What amount of gross profit (or loss) would Beck record on this project in each year under the percentage-of-completion (over time) method? 2. What amount of gross profit (or loss) would Beck record on this project in each year under the cost recovery method (point in time) for construction accounting?

VI - Methods of Construction Accounting 2eck Construction Company bęgan work on a new building project on January 1, 20x4. The Dvect is to be completed by December 31, 20x6, for a fixed price of P108 million. The following prehe actual costs incurred and estimates of remaining costs to complete the project that were made by Beck's accounting staff: Actual Costs incurred in each year Estimated remaining costs to complete the project measured at Dec. 31 of each year) Years 20x4 20x5 20x6 P30,000,000 P45,000,000 P35,000,000 P60,000,000 P45,000,000 PO Required: 1. What amount of gross profit (or loss) would Beck record on this project in each year under the percentage-of-completion (over time) method? 2. What amount of gross profit (or loss) would Beck record on this project in each year under the cost recovery method (point in time) for construction accounting?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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PROBLEMS 359 VI - Methods of Construction Accounting peck Construction Company bęgan work on a new building project on January 1, 20x4. The Devect is to be completed by December 31, 20x6, for a fixed price of P108 million. The following prethe actual costs incurred and estimates of remaining costs to complete the project that were made by Beck's accounting staff: Estimated remaining costs to complete the project measured at Dec. 31 of each year) P60,000,000 P45,000,000 PO Actual Costs incurred in each year Years 20x4.. 20x5 P30,000,000 P45,000,000 P35,000,000 20x6. Required: 1. What amount of gross profit (or loss) would Beck record on this project in each year under the percentage-of-completion (over time) method? 2. What amount of gross profit (or loss) would Beck record on this project in each year under the cost recovery method (point in time) for construction accounting?
Transcribed Image Text:PROBLEMS 359 VI - Methods of Construction Accounting peck Construction Company bęgan work on a new building project on January 1, 20x4. The Devect is to be completed by December 31, 20x6, for a fixed price of P108 million. The following prethe actual costs incurred and estimates of remaining costs to complete the project that were made by Beck's accounting staff: Estimated remaining costs to complete the project measured at Dec. 31 of each year) P60,000,000 P45,000,000 PO Actual Costs incurred in each year Years 20x4.. 20x5 P30,000,000 P45,000,000 P35,000,000 20x6. Required: 1. What amount of gross profit (or loss) would Beck record on this project in each year under the percentage-of-completion (over time) method? 2. What amount of gross profit (or loss) would Beck record on this project in each year under the cost recovery method (point in time) for construction accounting?
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