eBook Show Me How Calculator Long-term Contracts King Construction Company began
ID: 2478017 • Letter: E
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Long-term Contracts
King Construction Company began work on a contract in 2017. The contract price is $4,000,000, and King determined that its performance obligation was satisfied over time. Other information relating to the contract is as follows:
Required:
1. How much gross profit or loss does King recognize in 2017?
2. Prepare the appropriate sections of the 2017 income statement.
Prepare the appropriate sections of the 2017 ending balance sheet.
2017 Costs incurred during the year $ 800,000 Estimated costs to complete, December 31 2,400,000 Billings during the year 600,000 Collections during the year 400,000Explanation / Answer
Answer:1
Answer:2
Answer:3
KING CONSTRUCTION COMPANY Gross profit/Loss 2017 Particulars Amount Explanation Construction costs incurred to date 8,00,000 Estimated costs to complete 24,00,000 Total estimated costs 32,00,000 Percent completed 25.00% 800000/3200000 Revenue to date 4000000 Revenue recognized 1000000 4000000*25% Construction costs incurred for year 8,00,000 Gross profit 2,00,000 1000000-800000Related Questions
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