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Q6. Contract price: $9.5 million; Year 6                 Year 7                 Year 8 Costs fo

Q6. Contract price: $9.5 million;

Year 6                 Year 7                 Year 8

Costs for the year                                              $3,825,000 $4,675,000 $1,300,000

Estimated cost to complete                               $4,675,000 $1,270,000         

Progress billing during the year                        $3,500,000 $4,100,000 $1,900,000

Cash collected during the year                         $3,100,000 $4,150,000 $2,100,000

(1) Using the percentage-of-completion method, determine the balance of construction in progress (CIP) at the end of year Year 7. [9 marks]

(2) Using the completed-contract method, determine the balance of construction in progress (CIP) at the end of year Year 7. [9 marks]

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ekkarill92 answered 2 years ago
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