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. O $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

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. O $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

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 9MC

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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
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?
29) Horner Construction uses the method. In percentage-of-completion 2024, Honer began work on a contract for $22,000,000; it was completed in 2025. The following cost data pertain to this contract: December 31 2025 2024 Cost Incurred during the year $5,600,000 Estimated costs to complete at the end of year $5,200,000 The amount of gross profit to be recognized on the income statement for the year ended December 31, 2025 is Year Ended A)$8,600,000 INCORRECT B)$3,440,000 C)$3,200,000 D)$3,600,000 $7,800,000
In 2021, Crane Corporation began construction work under a three-year contract. The contract price is $ 480000. Crane uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of costs incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2021, follow: Balance Sheet Accounts receivable—construction contract billings $ 192000 Construction in progress $ 600000 Less contract billings 480000 Costs and recognized profit in excess of billings 120000 Income Statement Income (before tax) on the contract recognized in 2021 $ 120000 How much cash was collected in 2021 on this contract? $ 480000 $ 48000 $ 288000 $ 192000
Bella Construction Co. uses the percentage-of-completion method. In 20x1, Bella began work on a contract for $2,477,005; it was completed in 20x2. The following cost data pertain to this contract: Year ended December 31, 20x1 Year ended December 31, 20x2 Costs incurred during the year $869,041 $559,369 Estimated costs to complete at the of year $494,825 - The amount of gross profit to be recognized on the income statement for the year ended December 31, 20x2 is: a. $553,770 b. $339,315 c. $1,048,595 d. $1,113,139
On February 1, 2023, Sandhill Contractors agreed to construct a building at a contract price of $3,460,000. The total estimated construction costs would be $1,890,000 and the project would be finished in 2025. Information relating to the costs and billings for this contract is as follows: Total costs incurred to date Estimated costs to complete Customer billings to date Collections to date 2023 Gross profit/ (loss) 689,850 1,200,150 1,100,000 1,000,000 2023 2024 573050 $1,162,000 $ 2,365,000 913,000 1,890,000 1,750,000 2025 Calculate the gross profit / (loss) that should be recognized for 2023, 2024, and 2025 using the percentage completion method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round percentage complete to 1 decimal place, e.g. 15.2% and final answers to O decimal places, e.g. 5,125.) 2024 -0- 3,460,000 2,950,000 -107450 $ LA 2025 40450
During 2023, Marigold Corp. started a construction job with a total contract price of $1072000. Marigold has consistently used the completed-contract method. The job was completed on December 15, 2024. Additional data are as follows: Actual costs incurred Estimated remaining costs Billings to date Collections to date 2023 O $120300 O $0 O $140200 O $209800 $405000 405000 361000 208000 2024 $457200 695300 481300 For 2024, what amount should Marigold recognize as gross profit?
The Lao Construction Company recognizes revenue over time according to percentage of completion for its long-term construction contracts. In 2024, Lao began work on a construction contract. Information on this contract at the end of 2024 is as follows: Cost incurred during the year $ 1,500,000 Estimated additional cost to complete 6,000,000 Gross profit recognized in 2024 250,000 What is the contract price (total revenue) on this contract?
SMC entered into a long-term construction contract for 3 years. Contract price agreed was P4,150,000. The outcome of the contract was estimated reliably. The following data were ascertained for the contract: December 31, 2017 December 31, 2018Percentage of completion 30% 82.5%Estimated cost to complete 1,960,000 840,000 1. What is the total cost incurred in year 2018?A. 4,073,750 C. 1,680,000B. 840,000 D. 3,120,000 2. The realized gross profit (loss) in year 2018 isA. 650,000 C. (. 245,000)B. 405,000 D. (1,055,000) 3. What is the construction cost of sales for year 2018?A. 3,960,000 C. 3,233,750B. 3,120,000 D. 4,478,750 4. What is the construction-in-progress as of 2018?A. 3,423,750 C. 2,065,000B. 3,310,000 D. 2,470,000
During the year 2020, Pop Construction Corp. began work on a contract for $3,700,000. Other details follow:Costs incurred during the year $1,800,000Estimated costs to complete as of December 31= 1,200,000Billings during the year1,650,000Collections during the year 975,000 Pop uses the percentage-of-completion method. For calendar 2020, Pop should report gross profit of?