Clorad Corporation uses the percentage-of-completion method of accounting for construction contracts. Using the following information for Year

Question:

Clorad Corporation uses the percentage-of-completion method of accounting for construction contracts. Using the following information for Year 1, compute Clorad’s

(a) Total estimated costs to complete,

(b) Revenue to date,

(d) Gross profit recognized.

Year 1 (of four-year project):_____________________________________

Construction costs incurred during the year .........$ 174,000

Estimated costs to complete the contract .......... 426,000

Partial billings to customers ................ 100,000

Collections from customers ................ 25,000

Total contract price ..................1,000,000

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...