In 20x1, Electrified Construction Co. enters into a contract to construct a building for a customer. Electrified indentifies its performance obligation to be satisfied over time. Electrified measures its progress on the contrat based on costs incurred. The contract price is P20M. Electrified has an unconditional right to all billings made in accordance with the billing schedule stated in the contract. Information on the construction is as follows: 20x1 20x2 20x3 a. Contract costs incurred per yr. 8,160,000 7,320,000 1,920,000 b. Billings per year 10,000,000 7,000,000 3,000,000 c. Collections on billings per year 9,500,000 6,650,000 3,850,000 Requirements: a. Compute for the gross profits,
In 20x1, Electrified Construction Co. enters into a contract to construct a building for a customer. Electrified indentifies its performance obligation to be satisfied over time. Electrified measures its progress on the contrat based on costs incurred. The contract price is P20M. Electrified has an unconditional right to all billings made in accordance with the billing schedule stated in the contract. Information on the construction is as follows:
20x1 20x2 20x3
a. Contract costs incurred per yr. 8,160,000 7,320,000 1,920,000
b. Billings per year 10,000,000 7,000,000 3,000,000
c. Collections on billings per year 9,500,000 6,650,000 3,850,000
Requirements:
a. Compute for the gross profits, revenues, and costs of construction in 20x1, 20x2 and 20x3, respectively.
b. Provide the
c. Determine the amounts presented in the financial statements.
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