The Urban Construction Company commenced doing business in January 2008.Construction activities for the year 2008 are summarized

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The Urban Construction Company commenced doing business in January 2008.Construction activities for the year 2008 are summarized in the following table.


The Urban Construction Company commenced doing business in Janua


The company is your client. The president has asked you to compute the amounts of revenue for the year ended December 31, 2008, that would be reported under the completed-contract method and the percentage-of-completion method of accounting for long-term contracts.
The following information is available:
(a) Each contract is with a different customer.
(b) Any work remaining to be done on the contracts is expected to be completed in 2009.
(c) The company's accounts have been maintained on the completed-contract method.

Instructions:
1. Prepare a schedule computing the amount of revenue, cost, and gross profit (loss) by project for the year ended December 31, 2008, to be reported under
(a) The percentage-of- completion method and
(b) The completed-contract method. (Round to two decimal places on percentages.)
2. Prepare a schedule under the completed-contract method, computing the amount that would appear on the company's balance sheet at December 31, 2008, for
(a) Costs in excess of billings and
(b) Billings in excess of costs.
3. Prepare a schedule under the percentage-of-completion method showing the computation of the amount that would appear on the company's balance sheet at December 31, 2008, for
(a) Costs and estimated earnings in excess of billings and
(b) Billings in excess of costs and estimatedearnings.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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Intermediate Accounting

ISBN: 978-0324312140

16th Edition

Authors: James D. Stice, Earl K. Stice, Fred Skousen

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