Roe Construction Company uses the percentage-of-completion method of accounting. In 2021, Roe began work on a contract it had received which provided for a contract price of $15,000,000. Other details follow: 2021 Costs incurred during the year $7,200,000 Estimated costs to complete as of December 31 4,800,000 Billings during the year 6,600,000 Collections during the year 3,900,000 What should be the gross profit recognized in 2021?
Roe Construction Company uses the percentage-of-completion method of accounting. In 2021, Roe began work on a contract it had received which provided for a contract price of $15,000,000. Other details follow: 2021 Costs incurred during the year $7,200,000 Estimated costs to complete as of December 31 4,800,000 Billings during the year 6,600,000 Collections during the year 3,900,000 What should be the gross profit recognized in 2021?
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 9MC
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Roe Construction Company uses the percentage-of-completion method of accounting. In 2021, Roe began work on a contract it had received which provided for a contract price of $15,000,000. Other details follow:
|
|
2021 |
|
Costs incurred during the year |
$7,200,000 |
|
Estimated costs to complete as of December 31 |
4,800,000 |
|
Billings during the year |
6,600,000 |
|
Collections during the year |
3,900,000 |
What should be the gross profit recognized in 2021?
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