Unformatted text preview: Construction in progress: $65,000 Less contract billings : $61,6500 Cost of uncompleted contract in excess of billings 3,500 Income statement Income on the contract recognized in 2007 $18,200 EXERCISE -5 (10–15 minutes) (a) Contract billings to date $61,500 Less: Accounts receivable 12/31/07 21,500 Portion of contract billings collected $40,000 (b) $18,200 $65,000 = 28% (The ratio of gross profit to revenue recognized in 2007.) $1,000,000 X .28 = $280,000 (The initial estimated total gross profit before tax on the contract.) 18-18...
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- Spring '10
- Balance Sheet, Generally Accepted Accounting Principles, Beth Botsford, Beth Botsford Construction Corp., Beth Botsford Construction, contract billings