Paul Constructions has entered into a contract beginning January 1, 2020, to build a pool. It has been estimated that the pool will cost P300,000, and
Paul Constructions has entered into a contract beginning January 1, 2020, to build a pool. It has been estimated that the pool will cost P300,000, and will take three years to construct. The pool will be billed to the purchasing at P450,000. The following data pertain to the construction period.
2020
135,000
165,000
2021
210,000
90,000
2022
0
Cost to date:
Estimated cost to complete.
Progress billing to date. Cash collected to date
135.000 120.000
275.000 250,000
450,000 450.000
During 2020, Costs incurred include P15,000 standard materials stored at the site to be used in 2022 to complete the project. Using the percentage of completion method, compute the recognize gross profit for 2022:
a. 52,500
b. 45,000
c. 97.500
d. 150,000
2. The CIP net of Progress billing is
a. 27.500 current liability
b. 32,500 current asset
c. 167,500 current asset.
d. 102,500 current liability
Step by step
Solved in 3 steps with 2 images
