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Wildhorse Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $594,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $267,300 326,700 $463,320 130,680 268,000 547,000 238,000 497,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 2026 $ Using the cost-recovery method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0. please enter O. Do not leave any fields blank.) $ 2027 $606,000 -0- 896,000 896,000

Wildhorse Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $594,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $267,300 326,700 $463,320 130,680 268,000 547,000 238,000 497,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 2026 $ Using the cost-recovery method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0. please enter O. Do not leave any fields blank.) $ 2027 $606,000 -0- 896,000 896,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Wildhorse Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $594,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $267,300 326,700 268,000 238,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 $ 2026 $ Using the cost-recovery method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0, please enter O. Do not leave any fields blank.) 2027 $463,320 $606,000 130,680 547,000 497,000 -0- 896,000 896,000
Transcribed Image Text:Wildhorse Construction Company has entered into a contract beginning January 1, 2025, to build a parking complex. It has been estimated that the complex will cost $594,000 and will take 3 years to construct. The complex will be billed to the purchasing company at $896,000. The following data pertain to the construction period. Costs to date Estimated costs to complete Progress billings to date Cash collected to date 2025 $267,300 326,700 268,000 238,000 Gross profit recognized in 2025 $ Gross profit recognized in 2026 Gross profit recognized in 2027 $ 2026 $ Using the cost-recovery method, compute the estimated gross profit that would be recognized during each year of the construction period. (If answer is 0, please enter O. Do not leave any fields blank.) 2027 $463,320 $606,000 130,680 547,000 497,000 -0- 896,000 896,000
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