ACC 232 Financial Accounting Research Assignment Instructions

Your Financial Accounting Research assignment should be prepared as described below. Your report will have four distinct parts.

1. The first part of your report is the Question. In this section, you must identify the accounting problem. Be brief and precise. Try to write the question in one sentence. This section should not exceed two sentences.

2. The second part of your report is the Solution. In this section, you must clearly communicate your proposed solution to the accounting problem you identified in section one. Explain and lay out all of the steps involved in your solution. This will usually involve calculations and journal entries. Be sure to adequately answer the question from part one, including calculations and working. Your solution should be clear and understandable such that the reader does not have to read the authoritative literature for himself/herself. Please use in-text citations!

3. The third part of your report is the Authoritative Citation(s). In this section, you must list the titles of the citation(s) from the professional accounting literature upon which you based your solution.

These three parts of your typed research report should be about 1-1.5 single-spaced page in length.

4. In addition to the sections described above, you need to cut and paste the FULL DETAILS OF YOUR AUTHORITATIVE CITATION(S) at the end of your assignment.

See the example FARs Assignment on Reggienet for an illustration of what to follow.

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To access the FASB Accounting Standards Codification, go to:

http://www2.aaahq.org/ascLogin.cfm

Username: AAA51089

Password: yHJN73j

BELOW IS THE QUESTION THAT NEEDS TO BE ANSWERED.

ACC 232 - Financial Accounting Research Assignment

Fall 2023

(Submit on CANVAS before 9pm on October 9, 2023)

Accounting for Revenue

Your company, Construction & Refurbishment Ltd, entered a contract with a customer to refurbish a shopping mall in September 2023. This refurbishment includes the installation of new escalators.

The total value of the contract is $3 million. Your company expects to incur costs on the contract of $2.5 million, including the $1 million cost of the escalators. Your company is not involved in designing or manufacturing the escalators.

The escalators are delivered to the site in December 2023.

At the end of December 2023, your company observes that costs incurred on the contract (not including the escalators) are $750,000.

With reference to ASC606, explain to your boss what amounts of revenue, costs and profit should be recorded for the contract at the end of December 2023.

Answer rating: 100% (QA)

Question How should Construction Refurbishment Ltd record revenue costs and profit for a contract to refurbish a shopping mall including the installat... View the full answer