Question: Sheridan Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments

Sheridan Construction is constructing an office building under contract for Cannon Company and uses the percentage-of-completion method. The contract calls for progress billings and payments of $1200000 each quarter. The total contract price is $18222000 and Sheridan estimates total costs of $17400000. Sheridan estimates that the building will take 3 years to complete, and commences construction on January 2, 2021. At December 31, 2021, Sheridan estimates that it is 20% complete with the construction, based on costs incurred. What is the total amount of Revenue from Long-Term Contracts recognized for 2021 and what is the balance in the Accounts Receivable account assuming Cannon Company has not yet made its last quarterly payment?

Revenue

Accounts Receivable

$3480000

$1200000

$6074000

$3480000

$6074000

$3644400

$1200000

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