State Co. recognizes construction revenue and expenses using the percentage-of-completion method. During year 1, a single long-term
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Question:
State Co. recognizes construction revenue and expenses using the percentage-of-completion method. During year 1, a single long-term project was begun, which continued through year 2. Information on the project follows:
Year 1 | Year 2 | |
---|---|---|
Accounts receivable from construction contract | $100,000 | $300,000 |
Construction expenses | 105,000 | 192,000 |
Construction in progress | 122,000 | 364,000 |
Partial billings on contract | 100,000 | 420,000 |
Profit recognized from the long-term construction contract in year 2 should be
a. $ 50,000
b. $108,000
c. $128,000
d. $228,000
Related Book For
Intermediate Accounting
ISBN: 978-0132162302
1st edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
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