On June 1, 2019, Al-Bader Construction Company contracted to construct a building for Nass Company, for...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
On June 1, 2019, Al-Bader Construction Company contracted to construct a building for Nass Company, for a total contract price of $12,000,000. The project was to be completed by October 31, 2021 The annual costs incurred, estimated costs to complete the contract, billings to Nass and collections for 2019, 2020, and 2021 are given below 2020 2021 2019 54.320,000 Costs incurred to date: $7,005,000 $10,050,000 Estimated costs to complete 5,250,000 3,285,000 10 Bings to date 4,800,000 10,050,000 12,600,000 Collections to dato 3,000,000 8,250,000 9,750,000 Instructions: If Al Bader Company uses the percentage-of-completion method; 1. Compute the amount of gross profit or loss to be recognized each year 2. Prepare all necessary journal entries for 2020 3. Prepare the journal entry to record the completion of the contract in 2021, 4 Prepare partial statement of financial position at December 31, 2019 5. If Al-Bader Company uses the cost-recovery method, prepare the necessary journal entry to recognize any gross profit in 2021. On June 1, 2019, Al-Bader Construction Company contracted to construct a building for Nass Company, for a total contract price of $12,000,000. The project was to be completed by October 31, 2021 The annual costs incurred, estimated costs to complete the contract, billings to Nass and collections for 2019, 2020, and 2021 are given below 2020 2021 2019 54.320,000 Costs incurred to date: $7,005,000 $10,050,000 Estimated costs to complete 5,250,000 3,285,000 10 Bings to date 4,800,000 10,050,000 12,600,000 Collections to dato 3,000,000 8,250,000 9,750,000 Instructions: If Al Bader Company uses the percentage-of-completion method; 1. Compute the amount of gross profit or loss to be recognized each year 2. Prepare all necessary journal entries for 2020 3. Prepare the journal entry to record the completion of the contract in 2021, 4 Prepare partial statement of financial position at December 31, 2019 5. If Al-Bader Company uses the cost-recovery method, prepare the necessary journal entry to recognize any gross profit in 2021.
Expert Answer:
Answer rating: 100% (QA)
Step 1 You have posted multiplepart questions so only the first three subparts are answered If any o... View the full answer
Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
Students also viewed these accounting questions
-
On March 1, 2017, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,400,000. The building was completed by...
-
On March 1, 2019, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,400,000. The building was completed by...
-
On March 1, 2014, Pechstein Construction Company contracted to construct a factory building for Fabrik Manufacturing Inc. for a total contract price of $8,400,000. The building was completed by...
-
Burke Fabricators completed two jobs in June. Burke Fabricators recorded the following costs assigned to the jobs by the companys activity-based costing system: Job 622 required 2,400 parts, 77,500...
-
The Fitness Studio, Inc., with the help of its investment bank, recently issued $43.125 million of new debt. The offer price (and face value) on the debt was $1,000 per bond and the underwriters...
-
Quantum cutting is a process by which absorption of a single high-energy photon, corresponding to incident light in the UV spectral region, results in the emission of two photons of lower energy, in...
-
Compare and contrast between various valuation methods. Which valuation methods are most appropriate for manufacturing firms and which are the most appropriate for internet-based ventures?
-
Jones Products manufactures and sells to wholesalers approximately 400,000 packages per year of under-water markers at $ 6 per package. Annual costs for the production and sale of this quantity are...
-
Pn Noraini owned a property and provide the following information for the year ended 31 December 2015: Receipts: RM Rental: Jan - Dec 2015 40000 Jan - Mar 2016, received in Dec 2015 10000 Deposits...
-
Assume that you are part of the accounting team for Copeland Productions. The company currently expects to sell 533 units for total revenue of $16,900 each month. Copeland Productions estimates...
-
On December 31, 2012, Ogallala Associates owned the following securities, held as a long-term investment. The securities are not held for influence or control of the investee. Common Stock Shares...
-
Mountaintop golf course is planning for the coming season. Investors would like to earn a 12% return on the company's $50,000,000 of assets. The company primarily incurs fixed costs to groom the...
-
Common stockholders' profitability analysis A company reports the following: Net income Preferred dividends Average stockholders' equity $295,000 11,800 2,543,103 1,514,439 Average common...
-
World Bridge Corporation manufactures a telecommunications device. During its first year of operations, the company started and completed 50 devices at a cost of $60,000 per unit. Of these, 48 were...
-
The Sweetwater Candy Company would like to buy a new machine that would automatically dip" chocolates. The dipping operation currently is done largely by hand. The machine the company is considering...
-
Chapman Company obtains 100 percent of Abernethy Company's stock on January 1, 2023. As of that date, Abernethy has the following trial balance: Items Debit Accounts receivable Accounts payable...
-
1. Using SolarSystem as the base class, create two derived classes InnerPlanet and OuterPlanet.2. Create classes for each planet and categorized them in the two derived classes. 3. Create a Moon...
-
Anna, a high school counselor, devised a program that integrates classroom learning with vocational training to help adolescents at risk for school dropouts stay in school and transition to work...
-
Record Sales Gross and Net On June 3, Bolton Company sold to Arquette Company merchandise having a sale price of $2,000 with terms of 2/10, n/60 f.o.b. shipping point. An invoice totaling $90, terms...
-
Latta Inc. is preparing its opening IFRS statement of financial position on January 1, 2019. Under its previous GAAP, Latta had deferred certain advertising costs amounting to $37,000. Prepare the...
-
Why is it necessary to develop a definitional framework for the basic elements of accounting?
-
The same suspension as that in Problem 39 above was subsequently tested in a $28 \mathrm{~mm}$ internal diameter pipe, and the following data reported: $\Gamma\left(\mathrm{s}^{-1} ight)$ 127 200 289...
-
A mercury manometer is connected between two points in a piping system that contains water. The downstream tap is $6 \mathrm{ft}$ higher than the upstream tap, and the manometer reading is $16...
-
The manometer equation is $\Delta \Phi=-\Delta ho g \Delta h$, where $\Delta \Phi$ is the difference in the total pressure plus static head $(P+ho g z)$ between the two points to which the manometer...
Study smarter with the SolutionInn App