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
Chapter3: Income Sources
Section: Chapter Questions
Problem 88P
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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](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd56e9c7b-6890-4f1d-871e-0176b2130677%2Fbdd7f9a9-4eca-4c84-be14-5268457f7daa%2Fyweowtm_processed.jpeg&w=3840&q=75)
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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