Question
In: Accounting
On February 1, 2010, Marcos Contractors agreed to construct a building at a contract price of...
On February 1, 2010, Marcos Contractors agreed to construct a
building at a contract price of $3,000,000. Marcos estimated total
construction costs would be $2,000,000 and the project would be
finished in 2012. Information relating to the costs and billings
for this contract is as follows:
? 2010?? 2011?? 2012?
Total costs incurred to date?$
750,000?$1,320,000?$2,300,000
Estimated costs to complete?1,250,000? 880,000?-0-
Customer billings to date?1,100,000? 2,000,000?3,000,000
Collections to date?1,000,000? 1,750,000?2,950,000
Instructions
1. Fill in the correct amounts on the following schedule. For
percentage-of-completion and for completed-contract accounting,
show the gross profit that should be recorded for 2010, 2011, and
2012.
2. Prepare all entries for 2010, 2011, and 2012 for
Marco.
3. Prepare Statement of Financial Position ends of 2010, 2012
and 2011(if any) under Percentage of-completion-method,
completed-contract method.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
On February 1, 2010, Marcos Contractors agreed to construct a building at a contract price of...
On February 1, 2010, Marcos Contractors agreed to construct a
building at a contract price of $3,000,000. Marcos estimated total
construction costs would be $2,000,000 and the project would be
finished in 2012. Information relating to the costs and billings
for this contract is as follows:
? 2010?? 2011?? 2012?
Total costs incurred to date?$ 750,000?$1,320,000?$2,300,000
Estimated costs to complete?1,250,000? 880,000?-0-
Customer billings to date?1,100,000? 2,000,000?3,000,000
Collections to date?1,000,000? 1,750,000?2,950,000
Instructions
1. Fill in the correct amounts on the following...
On February 1, 2010, Marsh Contractors agreed to construct a building at a contract price of...
On February 1, 2010, Marsh Contractors agreed to construct a
building at a contract price of $5,800,000. Marsh estimated total
construction costs would be $4,000,000 and the project would be
finished in 2012. Information relating to the costs and billings
for this contract is as follows: 2014 2015 2016 Total costs
incurred to date $1,500,000 $2,640,000 $4,600,000 Estimated costs
to complete 2,500,000 1,760,000 -0- Customer billings to date
2,200,000 4,000,000 5,600,000 Collections to date 2,000,000
3,500,000 5,500,000
Instructions Fill in...
On January 1, 2018, Grumpy Contractors agreed to construct a building at a contract price of...
On January 1, 2018, Grumpy Contractors agreed to construct a
building at a contract price of $5,000,000. Grumpy estimates that
the project will be finished in 2020. Information related to the
costs and billings for this contract are as follows:
2018
2019
2020
Total costs incurred to date
$1,500,000
$3,300,000
$4,400,000
Estimated costs to complete
2,500,000
1,000,000
-0-
Customer billings to date
1,200,000
2,700,000
4,400,000
Collections to date
1,000,000
2,500,000
4,400,000
Instructions:
Assuming the building was finished in 2020, calculate...
On February 1, 2020, a company agreed to construct a building at a contract price of...
On February 1, 2020, a company agreed to construct a building at
a contract price of $35,000. The company estimated the project
would be finished in 2022. Information relating to the costs and
billings for this contract is as follows:
2020 2021 2022
Total costs incurred to
date $8,000 $10,000 $22,000
Estimated costs to
complete 12,000 6,000 -0-
Customer billings to
date 8,000 24,000 29,000
Collections to
date 4,000 14,000 25,000
The journal entry to record Billings on
Construction in Process in 2021 has the amount of
_________.
On February 1, 2020, a company agreed to construct a building at a contract price of...
On February 1, 2020, a company agreed to construct a building
at a contract price of $42,000. The company estimated the project
would be finished in 2022. Information relating to the costs and
billings for this contract is as follows:
2020 2021 2022
Total costs incurred to date $8,000 $10,000 $22,000
Estimated costs to complete 12,000 6,000 -0-
Customer billings to date 9,000 21,000 29,000
Collections to date 4,000 14,000 25,000
If the company uses the percentage-of-completion method, an
inventory/current...
On February 1, 2020, Joe agreed to construct a building at a contract price of $17,400....
On February 1, 2020, Joe agreed to construct a building at a
contract price of $17,400. Joe estimated total construction costs
would be $12,000 and the project would be finished in 2022.
Information relating to the costs and billings for this contract is
as follows:
2020 2021 2022
Total costs incurred to
date $4,500 $7,920 $13,800
Estimated costs to
complete 7,500 5,280 -0-
Customer billings to
date 6,600 12,000 16,800
Collections to
date 6,000 10,500 16,500
Instructions:
Fill in the correct amounts on the following schedule. For
percentage-of-completion accounting and for completed-contract
accounting, show...
Chicago contractors got $5,400,000 contract to construct a school building for the City of Chicago. Work...
Chicago contractors got $5,400,000 contract to construct a
school building for the City of Chicago. Work on this contract
began in 2013 and the financial data pertaining to this contract is
available here. Cost incurred till Dec.31, 2013 $1,080,000 Billings
made to City $1,000,000 Amount collected from City $ 750,000 The
estimated future cost to complete this contract is $3,240,000.
(a) Prepare Chicago contractors 2013 journal entries using
COMPLETED CONTRACT method. (b) Show how the contract accounts will
appear in...
Red Builders agrees to construct a new building for Blue Co. for a total contract price...
Red Builders agrees to construct a new building for Blue Co. for
a total contract price of $6,000,000. The estimated construction
costs at inception was $4,000,000. The construction project was
completed after two years. Below are the actual costs for years 1
and 2:
Description
Cumulative
Year 1
Year 2
Cost incurred to date
1,200,000
2,500,000
Estimated additional costs to complete
3,600,000
2,100,000
Billings
1,050,000
2,300,000
Cash Collections
1,000,000
1,900,000
Red has determined that this contract qualifies for revenue
recognition...
On 01 May 2015, the management of Netcare concluded a contract with Build-IT Building Contractors, in...
On 01 May 2015, the management of
Netcare concluded a contract with Build-IT Building Contractors, in
terms of which the construction company undertook to build one
Medical Suite Block, consisting of 50 suites of 3 rooms, a waiting
room, Doctors consulting room, reception area and kitchenette. The
contract stipulated that the building would be completed by 15
December 2015.
The contracting parties also agreed to the following:
a) If the hostels are not completed by
15 December 2015, Build-IT Building...
McCombs Contractors received a contract to construct a mental health facility for $2,500,000. Construction was begun...
McCombs Contractors received a contract to construct a mental
health facility for $2,500,000. Construction was begun in 2020 and
completed in 2021. Cost and other data are presented below:
2020 2021
Costs incurred during the year $1,500,000 $1,300,000
Estimated costs to complete 1,200,000 0
Billings during the year 1,200,000 1,300,000
Cash collections during the year 1,000,000 1,500,000
Part 1: Assume that McCombs recognizes revenue on this contract
over time according to percentage of completion. Required: Compute
the amount of gross...
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