1. KC Construction Company has a contract to construct a $4,500,000 bridge at an estimated cost of $4,000,000. The contract is to start in July 2010, and the bridge is to be completed in October 2012. The following data pertain to the construction period.

a) Compute percentage of completion.

	2010	2011	2012
Contract price	$4,500,000
Less estimated cost:
Costs to date	1,000,000
Estimated costs to complete	3,000,000
Estimated total costs	4,000,000
Estimated total gross profit	$ 500,000
Percent complete	25%
	$1,000,000/$4,000,000

b) Prepare journal entries to record (1) the costs of construction, (2) progress billings, and (3) collections for 2010, 2011, and 2012.

c) KC

KC Construction Company has a contract to construct a $4,500,000 bridge at an estimated cost of $4,000,000. The contract is to start in July 2010, and the bridge is to be completed in October 2012. The following data pertain to the construction period. Compute percentage of completion. Prepare journal entries to record (1) the costs of construction, (2) progress billings, and (3) collections for 2010, 2011, and 2012. KC's entries to recognize revenue and gross profit each year and to record completion and final approval of the contract