During 2023, Sunland Company started a construction job with a contract price of $1,792,000. The job was completed in 2025. Thefollowing information is available. The contract is non-cancellable.Costs incurred to dateEstimated costs to completeBillings to date (non-refundable)Collections to date(a)20232024$448,000 $924,000672,000336,000 1,008,000907,200302.400308,00000002025$1,198,40001,792,0001,596,000Calculate the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used. (Enternegative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)nontROOF During 2023, Sunland Company started a construction job with a contract price of $1,792,000. The job was completed in 2025. Thefollowing information is available. The contract is non-cancellable.Costs incurred to dateEstimated costs to completeBillings to date (non-refundable)Collections to date(a)20232024$448,000 $924,000672,000336,000 1,008,000907,200302.400308,00000002025$1,198,40001,792,0001,596,000Calculate the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used. (Enternegative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)nontROOF

Using percentage of completion method, the revenue is recognized on the basis of the percentage of…

During 2023, Sunland Company started a construction job with a contract price of $1,792,000. The job was completed in 2025. The following information is available. The contract is non-cancellable. Costs incurred to date Estimated costs to complete Billings to date (non-refundable) Collections to date (a) 2023 $448,000 672,000 336,000 302,400 2024 $924,000 308,000 1,008,000 907,200 2025 $1,198,400 0 1,792,000 1,596,000

During 2023, Sunland Company started a construction job with a contract price of $1,792,000. The job was completed in 2025. The following information is available. The contract is non-cancellable. Costs incurred to date Estimated costs to complete Billings to date (non-refundable) Collections to date (a) 2023 $448,000 672,000 336,000 302,400 2024 $924,000 308,000 1,008,000 907,200 2025 $1,198,400 0 1,792,000 1,596,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 26E

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On March 1, 2019, Elkhart enters into a new contract to build a specialized warehouse for 7 million. The promise to transfer the warehouse is determined to be a performance obligation. The contract states that if the warehouse is usable by November 30, 2019, Elkhart will receive a bonus of 600,000. For every week after November 30 that the warehouse is not usable, the bonus will decrease by 150,000. Elkhart provides the following completion schedule: Required: 1. Assume that Elkhart uses the expected value approach. What amount should Elkhart use for the transaction price? 2. Assume that Elkhart uses the most likely amount approach. What amount should Elkhart use for the transaction price? 3. Next Level What is the purpose of assessing whether a constraint on the variable consideration exists?
A A N T During 2023, Cullumber Corporation started a construction job with a contract price of $3.78 million. Cullumber ran into severe technical difficulties during construction but managed to complete the job in 2025. The contract is non-cancellable. Under the terms of the contract, Cullumber sends billings as revenues are earned. Billings are non-refundable. The following information is available: Costs incurred to date Estimated costs to complete (a) 0 S? S X Your anwwer is correct alt Calculate the amount of gross profit that should be recognized each year under the percentage-of-completion method. (Enter Type here to search B LU $ C R D. F 2023 $540,000 2.835.000 5 V T $1,890,000 2024 6 1,890.000 B 6 193 Y G H 17 &7 & 17 7 2025 $3.680.000 N 10 8 UO (81 ( 19 MO -1°C Clear JOK 2 10 V NOGO alt 00 0 L 3 111 OU РО { . I NO ** 112 0 13 [ ? 0 ctri de insert L4 1 backspace enter t shift SUP ENG V
Sheridan Construction Co. uses the percentage-of-completion method. In 2024, Sheridan began work on a contract for $21300000; it was completed in 2025. The following cost data pertain to this contract: Cost incurred during the year Estimated costs to complete at the end of year Year Ended December 31 $8516000. $2990000. $3680000. $3684000. 2024 $7254000 4836000 2025 $5530000 The amount of gross profit to be recognized on the income statement for the year ended December 31, 2025 is
During 2023, Grouper Corporation started a construction job with a contract price of $4.34 million. Grouper ran into severe technical difficulties during construction but managed to complete the job in 2025. The contract is non-cancellable. Under the terms of the contract, Grouper sends billings as revenues are earned. Billings are non-refundable. The following information is available: Costs incurred to date Estimated costs to complete 2023 2024 $620,000 $2,170,000 3,255,000 2,170,000 2025 $4,240,000 -0- Assume billings for the construction contract were as follows: 2023, $520,000: 2024, $2,050,000; and 2025, $1,770,000.
During 2023, Pharoah Company started a construction job with a contract price of $1,728, 000. The job was completed in 2025. The following information is available. The contract is non - cancellable. 2023 2024 2025 Costs incurred to date 432,000 891, 000 1, 155, 600 Estimated costs to complete 648, 000 297, 000 0 Billings to date 324, 000 972, 000 1,728, 000 1,539,000 Collections to date 291, 600 874, 800 Prepare all necessary journal entries for the Pharoah contract for 2024. ( Use Materials, Cash, Payables for costs incurred to date.)
Cullumber Construction Co. uses the percentage-of-completion method. In 2024, Cullumber began work on a contract for $23200000; it was completed in 2025. The following cost data pertain to this contract: Year Ended December 31 2024 2025 Cost incurred during the year $8736000 $5720000 Estimated costs to complete at the end of year 5824000 The amount of gross profit to be recognized on the income statement for the year ended December 31, 2025 is ○ $3456000. ○ $8744000. $2920000. $3560000.
Concord Corp. contracted to construct a building for $729000. Construction began in 2023 and was completed in 2024. Data relating to the contract follow: Costs incurred Estimated costs to complete Year Ended December 31 O $112642 and $74358. O $133122 and $53878. O $423000 and $306000. O $0 and $236000. 2023 $306000 202000 2024 $236000 Concord uses the percentage-of-completion method. For the calendar years 2023 and 2024, respectively, Concord should report gross profit of
Crane Construction Co. uses the percentage-of-completion method. In 2021, Crane began work on a contract for $24475000; it was completed in 2022. The following cost data pertain to this contract: Year Ended December 31 2021 2022 Cost incurred during the year $8350000 $6150000 Estimated costs to complete at the end of year 5739000 If the completed-contract method of accounting was used, the amount of gross profit to be recognized for years 2021 and 2022 would be 2021 2022 $9975000. $(411000). $0. $10386000. $10386000. $0. $0. $9975000. O O
During 2025, Cullumber Company started a construction job with a contract price of $1,620,000. The job was completed in 2027. The following information is available. Costs incurred to date Estimated costs to complete Billings to date Collections to date Ⓡ 2025 $393,900 $889,380 Gross profit recognized in 2026 616,100 Gross profit recognized in 2027 303,000 273.000 Gross profit recognized in 2025 $ 2026 $ $ 208,620 902,000 814,000 2027 Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used. $1,061,000 -0- 1,620,000 1,418,000
Current Attempt in Progress During 2023, Sunland Corporation started a construction job with a contract price of $3.50 million. Sunland ran into severe technical difficulties during construction but managed to complete the job in 2025. The contract is non-cancellable. Under the terms of the contract, Sunland sends billings as revenues are earned. Billings are non-refundable. The following information is available: (a) 2023 2024 2025 Costs incurred to date $500,000 $1,750,000 $3,400,000 Estimated costs to complete 2,625,000 1,750,000 -0- - Your answer is partially correct. Calculate the amount of gross profit that should be recognized each year under the percentage-of-completion method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Gross profit/(loss) $ 2023 2024 -100,000.00 $ 2025 $ 100000 द
On January 1, 2021. Robredo Co. started the construction of a building with a fixed contract price of P10,000,000. The outcome of the construction project can be estimated reliably and the contractor decided to employ cost to cost method. The following data are provided by the accountant and project manager concerning the construction costs for the three years of construction: Year 12/31/2021 12/31/2022 12/31/2023 P 3740000 Costs incurred during the year Realized gross profit/(loss) during the year Percentage of completion as of the end of the year ? ? P750,000 (P250,000) (P800,000) 50% 37.5% ? What is the balance of Construction in Progress on December 31, 2023?
ABC. Inc. works on a P5,250,000 contract in 2022 to construct an office building. During 2022, ABC Inc uses the cost to cost method. At December 31, 2022, the balances in certain accounts were: Construction in progress- P1.890,000; accounts receivable - P180,000; and bilings on construction in process- P900,000 contract retention P90,000; mobilization fee - P70,000. At December 31.2022, the estimated cost to completion are P2,352,000. HHow much is the realized gross profit in 2022?