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)