17-25

$4,000,000, a n g determined that its performance obligation was satisfied over ing to the contract is as follows: 2019 Costs incurred during the year $ 800,000 Estimated costs to complete, December 31 2,400,000 Billings during the year 600,000 Collections during the year 400,000 Required: 1 How much gross profit or loss does King recognize in 2019 2. Next Level Prepare the appropriate sections of the 2019 income statement and ends s of the 2019 income statement and ending balance sheet. 7.25 Long-Term Contracts Koolman Construe construction Company began work on a contract in 2019. The contract price is $3,000,000, and the company determined * cumpany determined that its performance obligation was satisfied over time. tion relating to the contract is as follows: 2019 2020 Costs incurred during the year $ 600,000 $ 700,000 Estimated costs to complete, December 31 1,400,000 1,200,000 Billings during the year 500,000 850,000 Collections during the year 400,000 800,000 1017.8 Required: 1. Compute the gross profit or loss recognized in 2019 and 2020. 2. Prepare the appropriate sections of the income statement and ending balance sheet for each year. E17-26 Long-Term Contracts Newberg Construction Corp. contracted to construct a building for $400,000. Construc 10 17.8 tion began in 2019 and was completed in 2020. Data relating to the contract are as follows: Year Ended December 31, 2019 2020 Costs incurred $200,000 $110,000 Estimated costs to complete 100,000 Newberg determined that its performance obligation was satisfied over time