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- n January 1, 2021, ABC enters into a contract to construct a building for a customer. ABC identifies its performance obligation to satisfied over time. ABC uses the input method based on costs to measure its progress on the contract. The contract price is P9M Information on the construction is provided below: 2021 2022 2023 a. Contract cost incurred per year 2,760,000 3,540,000 500,000 b. Billing per year 50% 25% 25% c. Collections on billings per year d. Estimated costs to complete (at each yr. end) 4,140,000700,000 90% 90% balance Note: Billings per year are stated as percentages of the contract price. The contract is non-cancellable. The collection on billings in 2021 and 2022 are net of 10% retention. "Retention" is an amount withheld by the contracted and payable to the contractor at the end of the contract when the project is completed and accepted. Requirements; a. Compute for the gross profits, 2021 2022 2023The Leto Construction Company began work on a $12.000 contract on 1/1/20. Planned completion was in 2022. The Percentage-of Completion method a used Given the following December 31 2021 $4.200 6,300 5,100 6,000 2020 2022 $11,650 $2,500 Costs incumed to dute Esbinated costs to compiete Bitingu to date Collections to date 7,600 4.000 3,800 12,000 11,900 The 12/31/21 belance of Construction in Progress is Select one O. $4300 Ob S5040 O $5.000 Od $4200 O $4800Concord Corp. contracted to construct a building for $729000. Construction began in 2023 and was completed in 2024. Data relating to the contract follow: Costs incurred Estimated costs to complete Year Ended December 31 O $112642 and $74358. O $133122 and $53878. O $423000 and $306000. O $0 and $236000. 2023 $306000 202000 2024 $236000 Concord uses the percentage-of-completion method. For the calendar years 2023 and 2024, respectively, Concord should report gross profit of
- Sheridan Construction Co. uses the percentage-of-completion method. In 2024, Sheridan began work on a contract for $21300000; it was completed in 2025. The following cost data pertain to this contract: Cost incurred during the year Estimated costs to complete at the end of year Year Ended December 31 $8516000. $2990000. $3680000. $3684000. 2024 $7254000 4836000 2025 $5530000 The amount of gross profit to be recognized on the income statement for the year ended December 31, 2025 isVICWT Uncies Current Attempt in Progress On May 1, 2025, Jackson Inc. entered into a contract to deliver one of its specialty mowers to Wildhorse Landscaping Co. The contract requires Wildhorse to pay the contract price of $895 in advance on May 15, 2025. Wildhorse pays Jackson on May 15, 2025, and Jackson delivers the mower (with cost of $557) on May 31, 2025. Prepare the journal entry on May 1, 2025, for Jackson. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List debit entry before credit entry.) Date May 1, 2025 Account Titles and Explanation eTextbook and Media List of Accounts Debit Credit4SMC entered into a long-term construction contract for 3 years. Contract price agreed was P4,150,000. The outcome of the contract was estimated reliably. The following data were ascertained for the contract:December 31, 2021December 31, 2022Percentage of completion30%82.5%Estimated cost to complete1,960,000840,0001.What is the total cost incurred in year 2022? 1.What is the total cost incurred in year 2022? A.4,073,750 C. 1,680,000. B.840,000. D. 3,120,000 2.The realized gross profit (loss) in year 2022 is A.650,000. C. (. 245,000) B.405,000 D. (1,055,000) 3.What is the construction cost of sales for year 2022? A.3,960,000. C. 3,233,750 B.3,120,000. D. 4,478,750 4.What is the construction-in-progress as of 2022? A.3,423,750. C. 2,065,000 B.3,310,000. D. 2,470,000
- SMC entered into a long-term construction contract for 3 years. Contract price agreed was P4,150,000. The outcome of the contract was estimated reliably. The following data were ascertained for the contract: December 31, 2021 December 31, 2022 Percentage of completion 30% 82.5% Estimated cost to complete 1,960,000 840,000 1. What is the total cost incurred in year 2022? С. 1,680,000 D. 3,120,000 A. 4,073,750 В. 840,000 2. The realized gross profit (loss) in year 2022 is A. 650,000 B. 405,000 C. (. 245,000) D. (1,055,000) 3. What is the construction cost of sales for year 2022? С. 3,233,750 D. 4,478,750 A. 3,960,000 В. 3,120,000 4. What is the construction-in-progress as of 2022? А. 3,423,750 C. 2,065,000 В. 3,310,000 D. 2,470,000ABC Co. estimates total contract costs at completion d In 20x2. ABC incurs actual costs of P2.45M and revizes its ABC completes the construction in 20x3 The actual total 6. In 20x1, ABC Co. enters into a contact with a customer for the uses the cost-to-cost method in measuring its progress on the estimate of total contract costs at completion to P4.6M. construction of a building. The contract price is P6M. ABC Co. me contract. cost of the contract is P4.5M. How much is the profit recognized in 20x3? a. 420,000 b. 450,000 c 500,000 d. 550,0001.On March 1, 2022, AGGREGATES Company enters a contract to build a hotel which is estimated to cost P31,200,000. The company recognizes construction revenue over time. Data on this project for 2022-2024 follow:Contract BillingsCosts incurredEst’d Costs to Complete2022 10,500,000 5,460,000 20,540,0002023 12,500,000 9,984,000 13,156,0002024 14,440,000 15,756,000 -The contract contains a penalty clause that penalizes the company a reduction of P70,000 from the contract price for every week of delay. In 2024, the contract was delayed for 8 weeksWhat is the gross profit for 2024?A. 1,164,000 C. 1,724,000B. 1,466,400 D. 1,824,000 2.MOC Construction Company started work on three job sites during the current year. Any costs incurred are expected to be recoverable. Data relating to the three jobs are given below:Site Contract PriceCost IncurredEstimated Costs to CompleteBillings on ContractCollections on Billings1 5,000,000 3,750,000 - 5,000,000 5,000,0002 7,000,000 1,000,000 4,000,000 900,000…
- you osie uequised to prieposie arcount Showing the position of Contract 30.4.2014 f1om the folowing prepare. Conteract on particulass: Contsiact pece $1,00.000; matorials Sent to Site $ 32,350; lobbui engaged on Bite $ 27.4L00: plont installed at site $5,650; Value of plont on 30, 4.2014 $44.100; Work Heceived $ 65,000; Cost yot Cestilied $1700:0.Expenses $L200 Cost of estabishment $ 1L, 625; 0/8 $900: Moterials in hand $700: materials loreturined to Stores $200: 0tect expenser. 0/5 $100. Contified $7,500: Cash t Ol 1o0nk done but. of wagesAssume that Sunland Construction Company has a non-cancellable contract to construct a $4,520,000 bridge at an estimated cost of $4,068,000. The contract is to start in July 2023, and the bridge is to be completed in October 2025. The following data pertain to the construction period. Assume that progress billings are non-refundable. 2023 2024 2025 Costs to date (12/31) $1,017,000 $2,928,960 $4,576,500 Estimated costs to complete (12/31) 3,051,000 1,647,540 0 Progress billings during the year 968,000 2,418,000 1,134,000 Cash collected during the year 817,000 1,897,000 1,806,000 The revised estimates for the bridge contract are as follows. 2023 Original Estimates 2024 Revised Estimates Contract price $4,520,000 $4,520,000 Estimated total cost 4,068,000 4,576,500* Estimated gross profit $452,000 Estimated loss $(56,500) *$2,928,960 + $1,647,540 (a1) Under the percentage-of-completion method, calculate…Entity 2 entered contracts with two separate customers on 1 January 2022. The following information relates to these two contracts for 2022. A B £’000 £’000 Total contract price 40,000 40,000 Costs incurred to date 12,000 12,000 Anticipated further costs to completion 18,000 18,000 Cumulative progress billings invoiced 10,000 10,000 Cumulative progress billings received 8,000 8,000 Only contract A’s performance obligation is satisfied over time. Entity 2 is using the input method to determine the percentage of completion. Show how these two contracts should be presented in Entity 2’s financial statements for 2022.
