WEIS Construction Company uses the percentage-of-completion method of accounting. In 2020, WEIS began work under contract #E2-D2, which provided for a contract price of $2,187,000. Other details follow:     2020   2021 Costs incurred during the year   $658,560   $1,408,000 Estimated costs to complete, as of December 31   909,440   –0– Billings during the year   421,000   2,187,000 Collections during the year   348,000   1,527,000 (a) What portion of the total contract price would be recognized as revenue in 2020? In 2021? Revenue recognized in 2020   $  Revenue recognized in 2021   $  (b) using the information above, but assuming the company uses the completed-contract method of accounting, what portion of the total contract price would be recognized? Revenue recognized in 2020   $  Revenue recognized in 2021   $

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
E12.
 
WEIS Construction Company uses the percentage-of-completion method of accounting. In 2020, WEIS began work under contract #E2-D2, which provided for a contract price of $2,187,000. Other details follow:

   
2020
 
2021
Costs incurred during the year   $658,560   $1,408,000
Estimated costs to complete, as of December 31   909,440   –0–
Billings during the year   421,000   2,187,000
Collections during the year   348,000   1,527,000

(a) What portion of the total contract price would be recognized as revenue in 2020? In 2021?


Revenue recognized in 2020  
Revenue recognized in 2021  

(b) using the information above, but assuming the company uses the completed-contract method of accounting, what portion of the total contract price would be recognized?

Revenue recognized in 2020  
Revenue recognized in 2021  

 

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Accounting for Long-Term contracts
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education