Question

In: Accounting

During 2020, Martinez Company started a construction job with a contract price of $1,610,000. The job...

During 2020, Martinez Company started a construction job with a contract price of $1,610,000. The job was completed in 2022. The following information is available.

2020

2021

2022

Costs incurred to date

$405,900 $766,500 $1,076,000

Estimated costs to complete

584,100 328,500 –0–

Billings to date

300,000 893,000 1,610,000

Collections to date

267,000 809,000 1,435,000

Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.

Gross profit recognized in 2020

$enter a dollar amount

Gross profit recognized in 2021

$enter a dollar amount

Gross profit recognized in 2022

$enter a dollar amount

List of Accounts

  

  

Question Part Score

--/3

Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. For costs incurred use account Materials, Cash, Payables.)

Account Titles and Explanation

Debit

Credit

enter an account title to record cost of construction

enter a debit amount

enter a credit amount

enter an account title to record cost of construction

enter a debit amount

enter a credit amount

(To record cost of construction.)

enter an account title to record progress billings

enter a debit amount

enter a credit amount

enter an account title to record progress billings

enter a debit amount

enter a credit amount

(To record progress billings.)

enter an account title to record collections

enter a debit amount

enter a credit amount

enter an account title to record collections

enter a debit amount

enter a credit amount

(To record collections.)

enter an account title to recognize revenue

enter a debit amount

enter a credit amount

enter an account title to recognize revenue

enter a debit amount

enter a credit amount

enter an account title to recognize revenue

enter a debit amount

enter a credit amount

(To recognize revenue.)

List of Accounts

  

  

Question Part Score

--/9

Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.

2020

2021

2022

Gross profit

$enter a dollar amount

$enter a dollar amount

$enter a dollar amount

Solutions

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