A-6 In 2025, Carla Vista Construction Corp. began construction work under a 3-year contract. The contract price was $1,100,000. CarlaVista uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is basedon the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relatingto this contract at December 31, 2025, are shown below.Accounts receivableConstruction in processBalance SheetLess: BillingsCosts and recognized profit in excess of billingsIncome Statement$64,00062,400Income (before tax) on the contract recognized in 2025$17,4001,600$16,640 (a)How much cash was collected in 2025 on this contract?Portion of contract billings collectedeTextbook and MediaSave for LaterWhat was the initial estimated total income before tax on this contract?Income before tax on this contract $eTextbook and MediaSave for Later$Type here to search3.Attempts: 0 of 2 used Submit AnswerAttempts: 0 of 2 usedSubmit Answerms: 7,070W

Required a Calculation of the amount of cash collected in 2025 on this contract.Particulars Amount…

How much cash was collected in 2025 on this contract? Portion of contract billings collected (b) eTextbook and Media Save for Later $ What was the initial estimated total income before tax on this contract?

How much cash was collected in 2025 on this contract? Portion of contract billings collected (b) eTextbook and Media Save for Later $ What was the initial estimated total income before tax on this contract?

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 6P

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In 2025, Sunland Construction Corp. began construction work under a 3-year contract. The contract price was $1,090,000. Sunland uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2025, are shown below. Balance Sheet Accounts receivable Construction in process Less: Billings Costs and recognized profit in excess of billings Income Statement $16,600 $62,500 58,000 4,500 Income (before tax) on the contract recognized in 2025 (a) Your answer is correct. How much cash was collected in 2025 on this contract? (b) Portion of contract billings collected $ eTextbook and Media * Your answer is incorrect. $20,000 41400 What was the initial estimated total income before tax on this contract? Income before tax on this contract $ 4500 Attempts: 2 of 15 used
In 2018, Long Construction Corporation began construction work under a three-year contract. The contract priceis $1,600,000. Long recognizes revenue over time according to percentage of completion for financial reportingpurposes. The financial statement presentation relating to this contract at December 31, 2018, is as follows:Balance SheetAccounts receivable (from construction progress billings) $30,000Construction in progress $100,000 Less: Billings on construction contract (94,000)Cost and profit of uncompleted contracts in excess of billings 6,000Income StatementIncome (before tax) on the contract recognized in 2018 $20,000Required:1. What was the cost of construction actually incurred in 2018?
In 2018, the Laguna Inc entered into a contract to construct a road for 5th Avenue for $14,000,000. The road was completed in 2018. Information related to the contract is as follows: Laguna uses the percentage-of-completion method of accounting for long-term construction contracts. Required: Calculate the amount of gross profit to be recognized in each of the three years. Prepare all necessary journal entries for each of the years (credit various accounts for construction costs incurred). Prepare a partial balance sheet for 2016 and 2017 showing any items related to the contract.
In 2020, Blue Construction Corp. began construction work under a 3-year contract. The contract price was $1,060,000. Blue uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2020, are shown below. Balance Sheet Accounts receivable $16,600 Construction in process $63,700 Less: Billings 65,400 Costs and recognized profit in excess of billings -1,700 Income Statement Income (before tax) on the contract recognized in 2020 $19,110 (a) How much cash was collected in 2020 on this contract? Portion of contract billings collected $enter a dollar amount (b) What was the initial estimated total income before tax on this contract? Income before tax on this contract $enter a…
In 2018, the Laguna Inc entered into a contract to construct a road for 5th Avenue for $14,000,000. The road was completed in 2018. Information related to the contract is as follows: Laguna uses the completed contract method of accounting for long-term construction contracts. Calculate the amount of gross profit to be recognized in each of the three years. Prepare all necessary journal entries for each of the years (credit various accounts for construction costs incurred). Prepare a partial balance sheet for 2016 and 2017 showing any items related to the contract.
In 2020, Grouper Construction Corp. began construction work under a 3-year contract. The contract price was $1,060,000. Grouper uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2020, are shown below. Balance Sheet Accounts receivable $17,700 Construction in process $68,300 Less: Billings 61,300 Costs and recognized profit in excess of billings 7,000 Income Statement Income (before tax) on the contract recognized in 2020 $16,392 (a) How much cash was collected in 2020 on this contract? Portion of contract billings collected $enter a dollar amount (b) What was the initial estimated total income before tax on this contract? Income before tax on this contract $enter a…
In 2020, Steinrotter Construction Corp. began construction work under a 3-year contract. The contract price was $1,000,000. Steinrotter uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2020, are shown below. Balance Sheet Accounts receivable $18,000 Construction in process $65,000 Less: Billings 61,500 Costs and recognized profit in excess of billings 3,500 Income Statement Income (before tax) on the contract recognized in 2020 $19,500 Instructions a. How much cash was collected in 2020 on this contract? b. What was the initial estimated total income before tax on this contract?
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
Current Attempt in Progress In 2025, Carla Vista Construction Corp. began construction work under a 3-year contract. The contract price was $1,100,000. Carla Vista uses the percentage-of-completion method for financial accounting purposes. The income to be recognized each year is based on the proportion of cost incurred to total estimated costs for completing the contract. The financial statement presentations relating to this contract at December 31, 2025, are shown below. Accounts receivable Construction in process Balance Sheet Less: Billings Costs and recognized profit in excess of billings Income Statement $64,000 62,400 Income (before tax) on the contract recognized in 2025 Portion of contract billings collected How much cash was collected in 2025 on this contract? $17.400 $16,640 1,600
In 2019, PJD Construction Corporation began construction work under a 3-year contract. The contract price was P4,000,000. PJD uses the percentage-of-completion method/over time 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 presentation relating to this contract at December 31, 2019 was as follows: What is the recognized revenue in 2019?
In 2018, the Laguna Inc entered into a contract to construct a road for 5th Avenue for $14,000,000. The road was completed in 2018. Information related to the contract is as follows: 1. Calculate the amount of gross profit to be recognized in each of the three years under percentage-of-completion method of accounting for long-term construction contracts. 2. Calculate the amount of gross profit to be recognized in each of the three years under completed contract method of accounting for long-term construction contracts.
road was completed in 2026. Information related to the contract is as follows: Cost incurred during the year Estimated costs to complete as of year-end Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year Assume that Westgate Construction's contract with Santa Clara County does not qualify for revenue recognition over time. Required: 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2024 (credit "Cash, Materials, etc." for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2025 (credit "Cash, Materials, etc." for construction costs incurred). Cost incurred during the year. Estimated costs to complete as of year-end 2-c. In the journal below, complete the necessary journal entries for the year 2026 (credit "Cash,…