Question 4 On 22 February 2018, Sun Company entered into a contract to build an apartment building. It will take 3 years to complete and is originally estimated that the building will cost $6,500,000 which is subject to revision. The contract price was $9,000,000. The following information pertains to the construction period. 2018 2019 2020 Cost to date $2,275,000 $5,280,000 $7,000,000 Estimated costs to complete 4,225,000 1,320,000 Progress billing to date 2,000,000 4,500,000 9,000,000 Cash collected to date 1,400,000 3,800,000 8,800,000 Required: (a) Compute the amount of gross profit to be recognized each year assuming the percentage-of-completion method is used. (b) Prepare all necessary journal entries for (c) Prepare a partial statement of financial position as at 31 December 2019, showing the balances in the receivables and inventory accounts. year 2020.
Question 4 On 22 February 2018, Sun Company entered into a contract to build an apartment building. It will take 3 years to complete and is originally estimated that the building will cost $6,500,000 which is subject to revision. The contract price was $9,000,000. The following information pertains to the construction period. 2018 2019 2020 Cost to date $2,275,000 $5,280,000 $7,000,000 Estimated costs to complete 4,225,000 1,320,000 Progress billing to date 2,000,000 4,500,000 9,000,000 Cash collected to date 1,400,000 3,800,000 8,800,000 Required: (a) Compute the amount of gross profit to be recognized each year assuming the percentage-of-completion method is used. (b) Prepare all necessary journal entries for (c) Prepare a partial statement of financial position as at 31 December 2019, showing the balances in the receivables and inventory accounts. year 2020.
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
Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments
Section: Chapter Questions
Problem 11P
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning