Please answer in good accounting form. ThankyouHow much is the Gross Profit/Loss Realized in 2019? Celestial Holdings Co. began constructing a condominiumon January 1, 2017 for a contract price of P2,500,000.The entity has assured collection of its contract and thecosts can be reliably estimated. For the year endedDecember 31, 2018, Celestial billed its client an additional60% of the contract price.Data relating totheconstruction are as follows:201720182019Constructionin600,000??Progress (CIP)Est. Cost to CompleteCost incurred per yearExcess of CIP over??-0-500,0001,200,000225,00050,000(250,000)Progress Billings

Computation of Gross Profit/Loss Realized in 2019: Gross Profit Realized in 2019= 425000

Answered: Celestial Holdings Co. began…

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Celestial Holdings Co. began constructing a condominium on January 1, 2017 for a contract price of P2,500,000.

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 9MC

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Question

Please answer in good accounting form. Thankyou

How much is the Gross Profit/Loss Realized in 2019?

Celestial Holdings Co. began constructing a condominium
on January 1, 2017 for a contract price of P2,500,000.
The entity has assured collection of its contract and the
costs can be reliably estimated. For the year ended
December 31, 2018, Celestial billed its client an additional
60% of the contract price.
Data relating to
the
construction are as follows:
2017
2018
2019
Construction
in
600,000
?
?
Progress (CIP)
Est. Cost to Complete
Cost incurred per year
Excess of CIP over
?
?
-0-
500,000
1,200,000
225,000
50,000
(250,000)
Progress Billings

Definition Definition Amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item

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