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Journal entries-percentage-of-completion. Drawbridge Construction Company was aw

ID: 2474990 • Letter: J

Question

Journal entries-percentage-of-completion. Drawbridge Construction Company was awarded a contract to construct an interchange at the junction of U.S. 94 and Highway 30 at a total contract price of $12,000,000. Construction started in 2014 and was finished in 2016. The total costs to complete the project were $9,000,000. Instructions - Prepare entries to record sales and revenue costs by year: Make the entry to record construction costs of $2,400,000, on construction in process 2014. Make the entry to record constructions costs of $6.8 million to date at 12/31/15. Make the entry to recognize completion of the job in 12/31/2016.

Explanation / Answer

DR CR a Construction in Process 24,00,000 Materials, Cash, Payables. 24,00,000 b Accounts Receivable 68,00,000 Billings on Construction in Process 68,00,000 c Construction Expenses. 24,00,000 Construction in Process 8,00,000 Revenue from Long-Term Contracts. 26.67%*12000000 3200000 Percentage Of Completion Total Cost to complete 9000000 Construction cost Incured 24,00,000 Percentage Of Completion 26.67%