M. 00 00 at of. Use the following information for the next two questions: Co. appropriately on a uses the cost-to-cost method in measuring construction contract with a customer. Information on this contract, which was completed in 20x3, is shown below: Bass its progress Transaction price Profit each year Costs incurred each year (AICPA-Adapted) 20x1 20,000,000 400,000 3,600,000 20x2 20,000,000 1,400,000 ? 10. How much are the contract costs incurred in 20x2? a. 5,800,000 c. 6,600,000 b. 6,200,000 d. 10,200,000 a. 5,400,000 b. 6,800,000 20x3 20,000,000 (200,000) 8,200,000 How much are the estimated additional costs to complete as of December 31, 20x2? c. 7,200,000 Vies d. 8,600,000

M. 00 00 at of. Use the following information for the next two questions: Co. appropriately on a uses the cost-to-cost method in measuring construction contract with a customer. Information on this contract, which was completed in 20x3, is shown below: Bass its progress Transaction price Profit each year Costs incurred each year (AICPA-Adapted) 20x1 20,000,000 400,000 3,600,000 20x2 20,000,000 1,400,000 ? 10. How much are the contract costs incurred in 20x2? a. 5,800,000 c. 6,600,000 b. 6,200,000 d. 10,200,000 a. 5,400,000 b. 6,800,000 20x3 20,000,000 (200,000) 8,200,000 How much are the estimated additional costs to complete as of December 31, 20x2? c. 7,200,000 Vies d. 8,600,000

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 20E: Assume the same facts as in E17-19, except that Rix cannot directly observe the stand-alone selling...

See similar textbooks

Similar questions

Use the following information for the next two questions: Bass Co. appropriately uses the cost-to-cost method in measuring construction contract with a customer. its progress on Information on this contract, which was completed in 20x3, is a shown below: 20x1 20x2 20x3 20,000,000 20,000,000 20,000,000 Transaction price Profit each year Costs incurred each year (200,000) 8,200,000 400,000 1,400,000 3,600,000 (AICPA - Adapted) 1. 10. How much are the contract costs incurred in 20x2? a. 5,800,000 b. 6,200,000 c. 6,600,000 d. 10,200,000 11. How much are the estimated additional costs to complete as of December 31, 20x2? a. 5,400,000 b. 6,800,000 c. 7,200,000 d. 8,600,000
Duke Ltd has a contract with a customer ongoing at the end of the financial year, 31 December 2020. Details of this contract are as follows:Total contract price £50,000Cost incurred to date £12,000Anticipated future costs £28,000Progress billing - Agreed price for the component completed £14,000Progress is measured using the output method under IFRS 15 Revenue from Contracts with Customers.What amount of revenue is able to be recognised for the year ended 31December 2020?a) £15,000b) £50,000c) £21,000d) £14,000
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 wages
Contract price of $2,400,000. Estimated. Information relating to the costs and billings for this contract is as follows: 2019 2020 2021 Costs incurred during the year 700,000 1,100,000 750,000 Estimated costs to complete 1,300,000 800,000 Instructions 1- Using the percentage-of-completion method, compute the gross profit or loss to be recognized each year. 2- Using the cost recovery method, compute the gross profit or loss to be recognized each year
Crane Corporation uses the completed-contract method. At the end of the first year of a $9023000 contract, the following information is available: Costs to date: Estimated costs to complete Progress billings during the year Cash collected during the year $2021000 O $991000 O $247750 O $275000 O $0 6011000 1811000 1536000 In the first year, Crane should recognize gross profit of Crane Corporation uses the co information is available: Costs to date: Estimated costs to complete Progress billings during the y Cash collected during the yea In the first voor Crano should r Snipping Tool Screenshot copied t Select here to mark
2. On January 1, 2020, an entity entered into a long-term construction contract with fixed contract price of P5,000,000. The entity billed its client as follows: 30% during 2020, 40% during 2021 and the remainder at the year of project completion. The following data were provided by the cost accountant of the entity: 2020 2021 2022 Cumulative Cost incurred as of the end of the year P2,200,000 P3,600,000 P4,800,000 Estimated remaining cost to complete at the end of the P3,300,000 P900,000 year 1. What is the excess of construction in progress over progress billings on December 31, 2020 under percentage of completion method, cost-to-cost approach? a. 500,000 b. 200,000 c. 300,000 d. 400,000 2. What is the excess of construction in progress over progress billings on December 31, 2021 under cost recovery method? a. 100,000 b. 500,000 c. 300,000 d. 400,000 3. Assume that an architect hired by the company made the following estimates of the project's percentage of completion at 50%, 90% and…
Leatned Corporation has proviaed insa costper COst pel period direc marerials: direct LaOor: variable manufact overnead:S1.65 Fixed manutack oveihead: Saes commisions: variable administiahve expense 070 fixed seling and admin expense: $5.90 4.0S $30,000 $9.600 Reauired a for Financial reporting purpo ses what IS the total amaunt of product costs incurrea. b. For financial reporting purposes what S the torai amounAt OF product costs ncurrea to sell 6,000 unitsz C It the selling price what is the contibution maigın per unst sold2 to mahe 6,000 unitS? $23.40 per unit altotal product (manufacruring) cost. bto tal pe1od inonmanueacturing) LOst contriburion margin Per unit
PT ABC uses the percentage-of-completion method of accounting. In 2018, ABC began work on a contract it had received which provided for a contract price of Rp37.500.000. Other details are provided below. What should be the gross profit recognized in 2018? * 2018 Costs incurred during the year Estimated costs to complete as of December 31 Billings during the year Collections during the year Rp18.000.000 12.000.000 16.500.000 9.500.000 Rp4.500.000 Rp7.500.000 Rp19.500.000 O Rp1.500.000
ABC 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. 550,000
Assume the same facts as in E17-19, except that Rix cannot directly observe the stand-alone selling prices of the installation and service contracts. However, Rix has determined that the cost of the installation services is 150 and historical margins relative to cost average 20%. Therefore, Rix estimates the stand-alone selling price of the installation services using an expected cost plus a margin approach. Rix decides to use an adjusted market assessment approach to estimate the selling price of the service contract. Rased on information obtained from competitors, Rix determines the average selling price of a similar service contract to be 350. Rix believes that it has a higher cost structure than its competitors and that it should increase this estimate by 10% to achieve an acceptable margin. Required: 1. Determine the stand-alone selling price of each good or service. 2. How should the transaction price be allocated among the products? (Round your answer to the nearest dollar.)
Complete the following paragraphs : If the common cost ( 450 000)$. distribution between S. and R. using N.R.V. the sales Value of S. ( 255 000)$. , ( 300 000)$. to the R. and the Cost after off point to the (S. ) ( 125 000)$. the value of N.R.V. to the S. ?. * (- 130000 )$ ( 130000)$. ( another option)
The Naples Company uses the percentage-of-completion method and the cost-to-cost method for its long-term construction contracts. On one such contract, Naples expects total revenues of P260,000. During the first year, Naples incurred costs pf P50,000 and billed the customer P30,000 under the contract. At what net amount should Naples Construction in Progress for this contract be reported at the end of the first year? a. P 35,000 b. 65,000