Pacific Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in...

 

 

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Pacific Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in 2018 and was completed in 2019. Pacific recognizes revenue over time according to the percentage of completion. Data relating to the contract are summarized below: Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year 2018 ($) 300,000 1,200,000 380,000 250,000 2019 ($) 1,575,000 0 1,620,000 1,750,000 a) Compute the contract asset or liability to be presented in the statement of financial position in 2018. b) Compute the contract asset or liability to be presented in the statement of financial position in 2019. Pacific Networks contracted to provide a customer with Internet infrastructure for $2,000,000. The project began in 2018 and was completed in 2019. Pacific recognizes revenue over time according to the percentage of completion. Data relating to the contract are summarized below: Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year 2018 ($) 300,000 1,200,000 380,000 250,000 2019 ($) 1,575,000 0 1,620,000 1,750,000 a) Compute the contract asset or liability to be presented in the statement of financial position in 2018. b) Compute the contract asset or liability to be presented in the statement of financial position in 2019.

Answer rating: 100% (QA)

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