DM, Inc. works on a P10,500,000 contract in 2015 to construct an office building. During 2015, DM, Inc. uses the cost to cost method. At December 31, 2015, the balances in certain accounts were: Construction in Progress – P3,780,000; Accounts Receivable – P360,000; and Billings on Construction in process – P1,800,000; contract retention – P180,000; Mobilization fee – P140,000. At December 31, 2015, the estimated cost at completion is P7,350,000. Determine the realized gross profit in 2015
DM, Inc. works on a P10,500,000 contract in 2015 to construct an office building. During 2015, DM, Inc. uses the cost to cost method. At December 31, 2015, the balances in certain accounts were: Construction in Progress – P3,780,000; Accounts Receivable – P360,000; and Billings on Construction in process – P1,800,000; contract retention – P180,000; Mobilization fee – P140,000. At December 31, 2015, the estimated cost at completion is P7,350,000. Determine the realized gross profit in 2015
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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DM, Inc. works on a P10,500,000 contract in 2015 to construct an office building. During 2015, DM, Inc. uses the
cost to cost method. At December 31, 2015, the balances in certain accounts were: Construction in Progress – P3,780,000;
Mobilization fee – P140,000. At December 31, 2015, the estimated cost at completion is P7,350,000. Determine the realized
gross profit in 2015
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