Zamponi's Construction Company reports its income for tax purposes on a completed contract basis and income for
Question:
Zamponi's Construction Company reports its income for tax purposes on a completed contract basis and income for financial statement purposes on a percentage-of-completion basis. A record of construction activities for 2013 and 2014 follows:
General and administrative expenses for 2013 and 2014 were $60,000 for each year and are to be recorded as a period cost.
Instructions:
1. Calculate the income for 2013 and 2014 that should be reported for financial statement purposes.
2. Calculate the income for 2014 to be reported on a completed-contract basis.
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