During October 4, 2020, BBB Co. contracts with DHB Co. to refurbish a 3-storey building and install new escalators for total consideration of P25,000,000. Total expected costs are P20,000,000, including P13,500,000 for the escalators. The escalators were delivered to the site in December 18, 2020, however, the escalators will not be installed until May 15, 2021. BBB Co. is not involved in designing or manufacturing the elevators. As of December 31, 2020, BBB Co. incurred P16,000,000 total costs. How much net profit will BBB Co. recognized at the end of 2020 in relation with its contract with DHB Co.?

Answer rating: 100% (QA)

To determine the net profit that BBB Co will recognize at the end of 2020 in relation to its contrac... View the full answer