In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara
Question:
In 2021, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2023. Information related to the contract is as follows:
2021 2022 2023
Cost incurred during the year: $2,580,000 $4,042,000 $2,175,800
Est. costs- complete for year-end: $6,020,000 1,978,000 $0
Billings during the year: 2,060,000 4,562,000 3,378,000
Cash collections during the year: 1,830,000 4,200,000 3,970,000
Westgate recognizes revenue over time according to percentage of completion.
Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information.
Intermediate Accounting
ISBN: 978-1260481952
10th edition
Authors: J. David Spiceland, James Sepe , Mark Nelson, Wayne Thomas