What is the total amount of Revenue from Long-Term Contracts and Construction Expenses that SMDC Construction will recognize for the year ended December 31, 2020?          Revenue          Expenses A.  P18,600,000   P18,750,000 B.  P4,650,000     P  4,687,500 C.  P4,650,000     P  5,250,000 D.  P4,687,500     P  4,687,500

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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  1. SMDC Construction is constructing an office building under contract for Onyx Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of P1,550,000 each quarter. The total contract price is P18,600,000 and SMDC Construction estimates total costs of P17,750,000. SMDC Construction estimates that the building will take 3 years to complete, and commences construction on January 2, 2018.

 

      SMDC Construction completes the remaining 25% of the building construction on December 31, 2020, as

      scheduled.

At that time the total costs of construction are P18,750,000. What is the total amount of Revenue from Long-Term Contracts and Construction Expenses that SMDC Construction will recognize for the year ended December 31, 2020?

         Revenue          Expenses

A.  P18,600,000   P18,750,000

B.  P4,650,000     P  4,687,500

C.  P4,650,000     P  5,250,000

D.  P4,687,500     P  4,687,500

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D
C
B
A
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