Question

Brady Construction Company contracted to build an apartment complex for a price of $6,400,000. Construction began in 2018 and was completed in 2020. The following is a series of independent situations, numbered 1 through 6, involving differing costs for the project. All costs are stated in thousands of dollars.

Estimated Costs to Complete
	Costs Incurred During Year						(As of the End of the Year)
Situation	2018		2019		2020		2018		2019		2020
1	1,640		2,550		1,320		3,870		1,320		—
2	1,640		1,320		2,960		3,870		2,960		—
3	1,640		2,550		2,720		3,870		2,620		—
4	640		3,140		1,280		4,480		945		—
5	640		3,140		2,280		4,480		2,620		—
6	640		3,140		3,200		5,955		2,960		—
Required: Complete the following table. (Do not round intermediate calculations. Enter answers in dollars. Round your final answers to the nearest whole dollar. Negative amounts should be indicated by a minus sign.) Gross Profit (Loss) Recognized Revenue Recognized over Time   Revenue Recognized Upon Completion Situation 2018 2019 2020 2018 2019 2020 1 264900 411887 213213 0 0 890000 2 264900 -24900 240000 0 0 480000 3 264900 4 5 6

Answer 1

Statement Showing Gross Profit/Loss Recognized ( $ in 000)
	Revenue Recognized Over time			Revenue Recognized Upon Completion
Situation	2018	2019	2020	2018	2019	2020
1	264.900	411.887	213.212			890.000
2	264.900	(24.900)	240.000			480.000
3	264.900	(674.900)	(100.000)		(410.000)	(510.000)
4	160.000	1,180.000	-			1,340.000
5	160.000	(160.000)	340.000			340.000
6	(195.000)	(145.000)	(240.000)	(195.000)	(340.000)	(775.000)
Revenue Recognized in 2018 ($in 000) Situation Cost Incurred as on 2018 ( A) Estimated Cost TO Complete (B) Total Cost to be incurred (C= A+B) % of completion (D=A/C*100) Total Contract Revenue ( E) Gross Margin ( F=E-C) Gross Profit Recognized (G=F*D) 1            1,640               3,870            5,510                       30             6,400                890           264.900 2            1,640               3,870            5,510                       30             6,400                890           264.900 3            1,640               3,870            5,510                       30             6,400                890           264.900 4                640               4,480            5,120                       13             6,400            1,280           160.000 5                640               4,480            5,120                       13             6,400            1,280           160.000 6                640               5,955            6,595                       10             6,400             (195)        (195.000) Revenue Recognized in 2019 ($in 000) Situation Cost Incurred as on 2019 ( A) Estimated Cost TO Complete (B) Total Cost to be incurred (C= A+B) % of completion (D=A/C*100) Total Contract Revenue ( E) Gross Margin ( F=E-C) Gross Profit Recognized (G=F*D) Gross Profit Already Recognized in 2018 (H) Gross Profit recognized for 2019 (I=G-H) 1            4,190               1,320            5,510                       76             6,400                890           676.788          264.900        411.887 2            2,960               2,960            5,920                       50             6,400                480           240.000          264.900        (24.900) 3            4,190               2,620            6,810                       62             6,400             (410)        (410.000)          264.900     (674.900) 4            3,780                  945            4,725                       80             6,400            1,675       1,340.000          160.000    1,180.000 5            3,780               2,620            6,400                       59             6,400                   -                        -            160.000     (160.000) 6            3,780               2,960            6,740                       56             6,400             (340)        (340.000)        (195.000)     (145.000) Revenue Recognized in 2020 ( $ in 000) Situation Cost Incurred as on 2020 ( A) Estimated Cost TO Complete (B) Total Cost to be incurred (C= A+B) % of completion (D=A/C*100) Total Contract Revenue ( E) Gross Margin ( F=E-C) Gross Profit Recognized (G=F*D) Gross Profit Already Recognized till 2019 (H) Gross Profit recognized for 2019 (I=G-H) 1            5,510            5,510                     100             6,400                890           890.000          676.788        213.212 2            5,920            5,920                     100             6,400                480           480.000          240.000        240.000 3            6,910            6,910                     100             6,400             (510)        (510.000)        (410.000)     (100.000) 4            5,060            5,060                     100             6,400            1,340       1,340.000       1,340.000                   -   5            6,060            6,060                     100             6,400                340           340.000                      -          340.000 6            6,980            6,980                     100             6,400             (580)        (580.000)        (340.000)     (240.000)