During 2020, Nilsen Company started a construction job with a contract price of $1,600,000. The job was
Question:
During 2020, Nilsen Company started a construction job with a contract price of $1,600,000. The job was completed in 2022. The following information is available.
Instructions
a. Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
b. Prepare all necessary journal entries for 2021.
c. Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
2020 2021 2022 Costs incurred to date Estimated costs to complete Billings to date |Collections to date $825,000 $400,000 $1,070,000 275,000 -0- 300,000 900,000 1,600,000 270,000 810,000 1,425,000
Step by Step Answer:
a Gross profit recognized in b c Gross profit recogn...View the full answer
Intermediate Accounting
ISBN: 978-1119503668
17th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfiel
Related Video
A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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