Solve_ch18 - (c) Make the entry to record the revenue and...

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Name: __________________________ Problem chapter 18 1. Percentage-of-completion method. Rollins Construction Co. contracted to build a bridge for $4,750,000. Construction began in 2009 and was completed in 2010. Data relating to the construction are: 2009 2010 Cost incurred $1,800,000 $1,950,000 Estimated costs to complete $2,300,000 Garnet uses the percentage-of-completion method. Instructions (a) How much revenue should be reported for 2009? Show your computation. (b) Make the entry to record progress billings of $2,000,000 during 2009.
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Unformatted text preview: (c) Make the entry to record the revenue and gross profit for 2009. (d) How much gross profit should be reported for 2010? Show your computation. a) revenue should be reported for 2009: 4750000*(1800000/4100000)=2085366 b) Account receivable 2000000 Billing on construction in process 2000000 c) Construction in Process (gross profit) 285366 Construction expense 1800000 Revenue from long-term contract 2085366 (d) Gross profit should be reported of 2010= 1000000-285366=714634 Page 1...
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