In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows: 2021 2022 2023 Cost incurred during the year $ 2,100,000 $ 2,450,000 $ 2,695,000 Estimated costs to complete as of year-end 4,900,000 2,450,000 0 Billings during the year 2,200,000 2,350,000 5,450,000 Cash collections during the year 1,900,000 2,300,000 5,800,000 Westgate recognizes revenue over time according to percentage of completion.
In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows: 2021 2022 2023 Cost incurred during the year $ 2,100,000 $ 2,450,000 $ 2,695,000 Estimated costs to complete as of year-end 4,900,000 2,450,000 0 Billings during the year 2,200,000 2,350,000 5,450,000 Cash collections during the year 1,900,000 2,300,000 5,800,000 Westgate recognizes revenue over time according to percentage of completion.
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter9: Operating Activities
Section: Chapter Questions
Problem 18PC
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5) In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows:
2021 | 2022 | 2023 | |||||||
Cost incurred during the year | $ | 2,100,000 | $ | 2,450,000 | $ | 2,695,000 | |||
Estimated costs to complete as of year-end | 4,900,000 | 2,450,000 | 0 | ||||||
Billings during the year | 2,200,000 | 2,350,000 | 5,450,000 | ||||||
Cash collections during the year | 1,900,000 | 2,300,000 | 5,800,000 | ||||||
Westgate recognizes revenue over time according to percentage of completion.
4. Calculate the amount of revenue and gross
2021 | 2022 | 2023 | |||||||
Costs incurred during the year | $ | 2,100,000 | $ | 3,900,000 | $ | 3,300,000 | |||
Estimated costs to complete as of year-end | 4,900,000 | 3,200,000 | 0 | ||||||
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