Question
In: Accounting
On March 1, 2017, Shamrock Construction Company contracted to construct a factory building for Fabrik Manufacturing...
On March 1, 2017, Shamrock Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,390,000. The building was completed by October 31, 2019. The annual contract costs incurred, estimated costs to complete the contract, and accumulated billings to Fabrik for 2017, 2018, and 2019 are given below: 2017 2018 2019 Contract costs incurred during the year $3,003,300 $2,179,700 $2,117,000 Estimated costs to complete the contract at 12/31 3,386,700 2,117,000 –0– Billings to Fabrik during the year 3,240,000 3,460,000 1,690,000
(a) Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2017, 2018, and 2019. (Ignore income taxes.) (If answer is 0, please enter 0. Do not leave any fields blank.)
(b) Using the completed-contract method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2017, 2018, and 2019. (Ignore income taxes.) (If answer is 0, please enter 0. Do not leave any fields blank. Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Solutions
ekkarill92 answered 1 year agoRelated Solutions
On March 1, 2017, Oriole Construction Company contracted to construct a factory building for Fabrik Manufacturing...
On March 1, 2017, Oriole Construction Company contracted to
construct a factory building for Fabrik Manufacturing Inc. for a
total contract price of $8,450,000. The building was completed by
October 31, 2019. The annual contract costs incurred, estimated
costs to complete the contract, and accumulated billings to Fabrik
for 2017, 2018, and 2019 are given below: 2017 2018 2019 Contract
costs incurred during the year $3,052,800 $2,254,300 $1,962,900
Estimated costs to complete the contract at 12/31 3,307,200
1,962,900 –0– Billings...
On March 1, 2017, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing...
On March 1, 2017, Pechstein Construction Company contracted to
construct a factory building for Fabrik Manufacturing Inc. for a
total contract price of $8,400,000. The building was completed by
October 31, 2019. The annual contract costs incurred, estimated
costs to complete the contract, and accumulated billings to Fabrik
for 2017, 2018, and 2019 are given below.
2017
2018
2019
Contract Costs Incurred during the year
$2,208,000
$2,230,000
$2,190,000
Estimated Costs to Complete the Contract at 12/31
$3,520,000
$2,190,000
-0-
Billings...
On March 1, 2017, Oriole Construction Company contracted to construct a factory building for Fabrik Manufacturing...
On March 1, 2017, Oriole Construction Company contracted to
construct a factory building for Fabrik Manufacturing Inc. for a
total contract price of $8,410,000. The building was completed by
October 31, 2019. The annual contract costs incurred, estimated
costs to complete the contract, and accumulated billings to Fabrik
for 2017, 2018, and 2019 are given below:
2017
2018
2019
Contract costs incurred during the year
$2,916,400
$2,079,200
$2,244,400
Estimated costs to complete the contract at 12/31
3,423,600
2,244,400
–0–
Billings...
Problem 18-10 On March 1, 2017, Sandhill Construction Company contracted to construct a factory building for...
Problem 18-10
On March 1, 2017, Sandhill Construction Company contracted to
construct a factory building for Fabrik Manufacturing Inc. for a
total contract price of $8,310,000. The building was completed by
October 31, 2019. The annual contract costs incurred, estimated
costs to complete the contract, and accumulated billings to Fabrik
for 2017, 2018, and 2019 are given below:
2017
2018
2019
Contract costs incurred during the year
$2,871,000
$2,304,900
$2,114,100 (2019 Row)
Estimated costs to complete the contract at 12/31...
On May 1, 2020, Jackson Construction Company contracted to construct a factory building for a total...
On May 1, 2020, Jackson Construction Company contracted to
construct a factory building for a total contract price of
$9,600,000. The building was completed by May 31,2022. The annual
contract costs incurred, estimated costs to complete the contract,
and accumulated billings to Fabrik for 2020, 2021, and 2022 are
given
below.
2020
2021
2022
Contract costs incurred during the year
$3,400,000
$2,400,000
$2,900,000
Estimated costs to complete the contract at Dec
31 ...
MSK Construction Company contracted to construct a factory building for $525,000. Construction started during 2019 and...
MSK Construction Company contracted to construct a factory
building for $525,000. Construction started during 2019 and was
completed in 2020. Information relating to the contract
follows:
2019
2020
Costs incurred during the
year
$
290,000
$
150,000
Estimated additional cost to
complete
145,000
—
Billings during the year
260,000
265,000
Cash collections during the
year
240,000
285,000
Required:
Record the preceding transactions in MSK’s books assuming it
recognizes revenue over time and uses costs incurred to measure the
extent to...
On March 1, 2019, Asbah contracted Nabali & Fares Construction Co. to construct a building on...
On March 1, 2019, Asbah contracted Nabali & Fares
Construction Co. to construct a building on land costing $800,000
(purchased from the contractor and included in the first payment).
The construction began on the office building on March 1. The
following expenditures were incurred for construction:
Date Expenditures
March 1, 2019 $ 1,200,000
May 1, 2019 1,680,000
August 1, 2019 3,000,000
September 30, 2019 4,800,000
The building was completed and ready for occupancy on
September 30, 2019. To finance purchase...
On March 1, 2019, Asbah contracted Nabali & Fares Construction Co. to construct a building on...
On March 1, 2019, Asbah contracted Nabali & Fares
Construction Co. to construct a building on land costing $800,000
(purchased from the contractor and included in the first payment).
The construction began on the office building on March 1. The
following expenditures were incurred for construction: Date
Expenditures March 1, 2019 $ 1,200,000 May 1, 2019 1,680,000 August
1, 2019 3,000,000 September 30, 2019 4,800,000 The building was
completed and ready for occupancy on September 30, 2019. To finance
purchase...
On March 1, 2019, Asbah contracted Nabali & Fares Construction Co. to construct a building on...
On March 1, 2019, Asbah contracted Nabali & Fares
Construction Co. to construct a building on land costing $800,000
(purchased from the contractor and included in the first payment).
The construction began on the office building on March 1. The
following expenditures were incurred for construction:
Date Expenditures
March 1, 2019 $ 1,200,000
May 1, 2019 1,680,000
August 1, 2019 3,000,000
September 30, 2019 4,800,000
The building was completed and ready for occupancy on
September 30, 2019. To finance purchase...
On March 1, 2019, Asbah contracted Nabali & Fares Construction Co. to construct a building on...
On March 1, 2019, Asbah contracted Nabali & Fares
Construction Co. to construct a building on land costing $800,000
(purchased from the contractor and included in the first payment).
The construction began on the office building on March 1. The
following expenditures were incurred for construction: Date
Expenditures March 1, 2019 $ 1,200,000 May 1, 2019 1,680,000 August
1, 2019 3,000,000 September 30, 2019 4,800,000 The building was
completed and ready for occupancy on September 30, 2019. To finance
purchase...
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