On February 1, 2016, Aplus Construction Company (ACC) agreed to construct a building at a contract price of $10,000,000.

Anonymous
timer Asked: Oct 15th, 2018
account_balance_wallet $9.99

Question Description

  • In 2016, ACC estimated total construction costs would be $8,500,000 and the project would be finished in 2018.
  • Information relating to the costs and billings for this contract is as follows:

2016 2017 2018

Total costs incurred to date $2,635,000 $6,365,000 $9,475,000

Estimated costs to complete 5,865,000 3,135,000 -0-

Customer billings to date 2,750,000 6,500,000 10,000,000

Collections to date 2,150,000 5,850,000 9,100,000

Instructions

Assume ACC uses percentage-of-completion accounting method.

(a) Compute the amount of gross profit to be recognized each year. (4.5 points)

(b) Prepare all necessary journal entries for 2017. (6.5 points

Tutor Answer

FrankRose23
School: Cornell University

Here are the solutions. Let me know if there is anything else.

Assume ACC uses percentage-of-completion accounting method.
(a) Compute the amount of gross profit to be recognized each year.

Contract Price (C)
Total co...

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Anonymous
awesome work thanks

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