During 2020, Headland Company started a construction job with a contract price of $1,590,000 The job was
Question:
During 2020, Headland Company started a construction job with a contract price of $1,590,000 The job was completed in 2022 The following information is available.
2020 | 2021 | 2022 | ||||
---|---|---|---|---|---|---|
Costs incurred to date | $410,000 | $901,180 | $1,067,000 | |||
Estimated costs to complete | 590,000 | 197,820 | –0– | |||
Billings to date | 297,000 | 903,000 | 1,590,000 | |||
Collections to date | 271,000 | 805,000 | 1,434,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
Gross profit recognized in 2020 | $enter a dollar amount | |
---|---|---|
Gross profit recognized in 2021 | $enter a dollar amount | |
Gross profit recognized in 2022 | $enter a dollar amount |
Prepare all necessary journal entries for 2021.
Account Titles and Explanation | Debit | Credit |
---|---|---|
enter an account title to record cost of construction | enter a debit amount | enter a credit amount |
enter an account title to record cost of construction | enter a debit amount | enter a credit amount |
(To record cost of construction.) | ||
enter an account title to record progress billings | enter a debit amount | enter a credit amount |
enter an account title to record progress billings | enter a debit amount | enter a credit amount |
(To record progress billings.) | ||
enter an account title to record collections | enter a debit amount | enter a credit amount |
enter an account title to record collections | enter a debit amount | enter a credit amount |
(To record collections.) | ||
enter an account title to recognize revenue | enter a debit amount | enter a credit amount |
enter an account title to recognize revenue | enter a debit amount | enter a credit amount |
enter an account title to recognize revenue | enter a debit amount | enter a credit amount |
(To recognize revenue.) |
Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
2020 | 2021 | 2022 | ||||
---|---|---|---|---|---|---|
Gross profit | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount |
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield