Question
In: Accounting
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,291,000 | $ | 3,555,000 | $ | 2,259,400 | |||
| Estimated costs to complete as of year-end | 5,609,000 | 2,054,000 | 0 | ||||||
| Billings during the year | 2,110,000 | 3,736,000 | 4,154,000 | ||||||
| Cash collections during the year | 1,855,000 | 3,500,000 | 4,645,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
rev: 09_15_2017_QC_CS-99734
Required:
1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. (Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.)
Solutions
Expert Solution
Solution
| 2018 | 2019 | 2020 | |
| Revenue | $ 29,00,000.00 | $ 45,00,000.00 | $ 26,00,000.00 |
| Gross profit | $ 6,09,000.00 | $ 9,45,000.00 | $ 3,40,600.00 |
Working
| Working | 2017 | 2018 | 2019 | |
| A | Contract Price | $ 1,00,00,000 | $ 1,00,00,000 | $ 1,00,00,000 |
| B | Cost Incurred to Date | $ 22,91,000 | $ 58,46,000 | $ 81,05,400 |
| C | Estimated cost yet to be incurred to complete the contract | $ 56,09,000 | $ 20,54,000 | $ - |
| D = B+C | Total Cost | $ 79,00,000 | $ 79,00,000 | $ 81,05,400 |
| E = (D/B) x 100 | % of Complition | 29% | 74% | 100% |
| F = A x E | Revenue to date | $ 29,00,000 | $ 74,00,000 | $ 1,00,00,000 |
| G | Revenue of Previous year | $ - | $ 29,00,000 | $ 74,00,000 |
| H = F - G | Net Revenue this year | $ 29,00,000 | $ 45,00,000 | $ 26,00,000 |
| I | Cost to date | $ 22,91,000 | $ 58,46,000 | $ 81,05,400 |
| J | Cost to date of previous year | $ - | $ 22,91,000 | $ 58,46,000 |
| K = I - J | Net Cost for the year | $ 22,91,000 | $ 35,55,000 | $ 22,59,400 |
| L = H - K | Gross Profits | $ 6,09,000 | $ 9,45,000 | $ 3,40,600 |
ekkarill92 answered 1 year agoRelated Solutions
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the
year
$
2,550,000
$
4,250,000
$
1,870,000
Estimated costs to complete as
of year-end
5,950,000
1,700,000
0
Billings during the year
2,050,000
4,750,000
3,200,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the
year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as
of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the
year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as
of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate...
Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs to complete as of year-end
5,396,000
2,204,000
0
Billings during the year
2,140,000
3,256,000
4,604,000
Cash collections during...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction...
Required information [The following information applies to the
questions displayed below.] In 2018, the Westgate Construction
Company entered into a contract to construct a road for Santa Clara
County for $10,000,000. The road was completed in 2020. Information
related to the contract is as follows: 2018 2019 2020 Cost incurred
during the year $ 2,490,000 $ 3,984,000 $ 2,008,600 Estimated costs
to complete as of year-end 5,810,000 1,826,000 0 Billings during
the year 2,030,000 4,444,000 3,526,000 Cash collections during the...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction...
Required information
[The following
information applies to the questions displayed
below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred
during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs
to complete as of year-end
5,396,000
2,204,000
0
Billings during
the year
2,140,000
3,256,000
4,604,000
Cash collections
during the...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction...
Required information
[The following
information applies to the questions displayed
below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018
2019
2020
Cost incurred
during the year
$
2,204,000
$
3,192,000
$
2,424,400
Estimated costs
to complete as of year-end
5,396,000
2,204,000
0
Billings during
the year
2,140,000
3,256,000
4,604,000
Cash collections
during the...
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