QUESTION 1: CONSTRUCTION/CIVIL FRAUD

A major infrastructure company, Mega Construction Corp. had been awarded a road construction contract by the government. For execution of the project, the company had sub-divided the geographies and execution areas and invited bids for the sub-contracting. The company had publicized a whistle-blower policy and received a complaint from one of the bidders about possible collusion between certain bidders. The matter was sought to be investigated by the management of the company.

As the company’s fraud expert, you are investigating this possible fraud and are preparing to take necessary actions to complete a thorough investigation.

REQUIRED:

(a) Determine the possible type of schemes being perpetrated and red flag indicators of the said conduct.

(b) What are the steps taken to complete the investigation and the evidence sought for prosecution of perpetrators?

Action Steel entered into a contract with Systems Builders for the construction of an addition to a commercial building. Systems Builders was the general contractor and agreed to erect a building designed and manufactured by Varco-Pruden. Part of Systems Builders’ contract with Action Steel included an agreement for the parties not to sue each other or any subcontractors or agents if another insurance plan was taken out on neighboring properties or the finished project. During the first winter after construction of the addition was complete, only a few months later, a portion of the building collapsed. Midwestern insured Action Steel under a policy issued after completion of the construction. Subsequently, Midwestern sued Varco-Pruden to recover and won. Midwestern appealed. Was Midwestern a third party to the contract such that it could sue Varco-Pruden? 3 paragrpahs

As a supervisor of a production department, you must decide the daily production totals of a certain product that has two models, the Deluxe and the Special. The profit on the Deluxe model is $12 per unit and the Special's profit is $10. Each model goes through two phases in the production process, and there are only 100 hours available daily at the construction stage and only 80 hours available at the finishing and inspection stage. Each Deluxe model requires 20 minutes of construction time and 10 minutes of finishing and inspection time. Each Special model requires 15 minutes of construction time and 25 minutes of finishing and inspection time. The company has also decided that there must be at least 150 Special models produced. Write the LP formulation to determine the optimal production mix of Deluxe and Special models.

Write a java program that calculates a speeding fine. The user is prompted for the speed of the vehicle, the posted speed limit and if the offence took place in the construction zone. The fine is calculated at $75 + 3$/ km over the speed limit for the first 20km over + $6 / km for the next 20 and $9/km after that. If the posted limit is 40km, the fine is doubled. If the offence took place in a construction zone, the fine is doubled as well. For example, (no construction zone involved):Speed = 77Limit = 50Fine = 75 + 20*3 + 7*6 = $177OrSpeed = 55Limit = 40Fine = (75 + 15*3) * 2 = $240Fines resulting in more than $260 produce the message “Warning, dangerous driving”.If the speed limit is exceeded more than 30km/h produce the message “Criminal offence, the court subpoena is issued?

On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,000,000. During 2021, costs of $2,000,000 were incurred, with estimated costs of $4,000,000 yet to be incurred. Billings of $2,500,000 were sent, and cash collected was $2,250,000.

In 2022, costs incurred were $2,500,000 with remaining costs estimated to be $3,600,000. 2022 billings were $2,750,000, and $2,475,000 cash was collected. The project was completed in 2023 after additional costs of $3,800,000 were incurred. The company’s fiscal year-end is December 31. This project does not qualify for revenue recognition over time.
  
Required:
1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years.
2a. Prepare journal entries for 2021 to record the transactions described (credit "various accounts" for construction costs incurred).
2b. Prepare journal entries for 2022 to record the transactions described (credit "various accounts" for construction costs incurred).
3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2021.
3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022.

On February 1, 2018, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,500,000. During 2018, costs of $2,200,000 were incurred, with estimated costs of $4,200,000 yet to be incurred. Billings of $2,740,000 were sent, and cash collected was $2,450,000.

In 2019, costs incurred were $2,740,000 with remaining costs estimated to be $3,900,000. 2019 billings were $2,990,000, and $2,675,000 cash was collected. The project was completed in 2020 after additional costs of $4,000,000 were incurred. The company’s fiscal year-end is December 31. This project does not qualify for revenue recognition over time.

Required:

1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years.

2a. Prepare journal entries for 2018 to record the transactions described (credit "various accounts" for construction costs incurred).

2b. Prepare journal entries for 2019 to record the transactions described (credit "various accounts" for construction costs incurred).

3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2018.

3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2019.

On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,050,000. During 2021, costs of $2,020,000 were incurred, with estimated costs of $4,020,000 yet to be incurred. Billings of $2,524,000 were sent, and cash collected was $2,270,000.

In 2022, costs incurred were $2,524,000 with remaining costs estimated to be $3,630,000. 2022 billings were $2,774,000, and $2,495,000 cash was collected. The project was completed in 2023 after additional costs of $3,820,000 were incurred. The company’s fiscal year-end is December 31. This project does not qualify for revenue recognition over time.

Required:
1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years.
2a. Prepare journal entries for 2021 to record the transactions described (credit "various accounts" for construction costs incurred).
2b. Prepare journal entries for 2022 to record the transactions described (credit "various accounts" for construction costs incurred).
3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2021.
3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022.

***PLEASE SHOW WORK***

% of Completion

On May 1, 2013, Chapin Construction Company entered into a $4,000,000 fixed-price contract to build an apartment building.Expected completion date is November, 2014.Assume a zero balance in the cash account as of 5/1/2013.

Please fill in Journal Entries and the Financial Statements below.Data pertaining to the construction period are as follows:

PART 1

On February 1, 2021, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,000,000. During 2021, costs of $2,000,000 were incurred, with estimated costs of $4,000,000 yet to be incurred. Billings of $2,500,000 were sent, and cash collected was $2,250,000.

In 2022, costs incurred were $2,500,000 with remaining costs estimated to be $3,600,000. 2022 billings were $2,750,000, and $2,475,000 cash was collected. The project was completed in 2023 after additional costs of $3,800,000 were incurred. The company’s fiscal year-end is December 31. This project does not qualify for revenue recognition over time.
  
Required:
1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years.
2a. Prepare journal entries for 2021 to record the transactions described (credit "various accounts" for construction costs incurred).
2b. Prepare journal entries for 2022 to record the transactions described (credit "various accounts" for construction costs incurred).
3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2021.
3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2022.

On February 1, 2018, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,075,000. During 2018, costs of $2,030,000 were incurred, with estimated costs of $4,030,000 yet to be incurred. Billings of $2,536,000 were sent, and cash collected was $2,280,000.

In 2019, costs incurred were $2,536,000 with remaining costs estimated to be $3,645,000. 2019 billings were $2,786,000, and $2,505,000 cash was collected. The project was completed in 2020 after additional costs of $3,830,000 were incurred. The company’s fiscal year-end is December 31. This project does not qualify for revenue recognition over time.

Required:
1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years.
2a. Prepare journal entries for 2018 to record the transactions described (credit "various accounts" for construction costs incurred).
2b. Prepare journal entries for 2019 to record the transactions described (credit "various accounts" for construction costs incurred).
3a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2018.
3b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2019.