The inventory of tvs will be reported on whose

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*109. The inventory of TVs will be reported on whose balance sheet and at what amount? Balance Sheet of Amount of Inventory a. TV Inc. $13,875 b. TV Inc. $13,500 c. Ed's TV $13,875 d. Ed's TV $13,500 Multiple Choice Answers —Computational Item Ans. Item Ans. Item Ans. Item Ans. Item Ans. Item Ans. Item Ans. 65. c 72. c 79. b 86. c 93. b 100. d *107. b 66. d 73. b 80. a 87. c 94. b 101. a *108. d 67. b 74. d 81. c 88. a 95. d 102. c *109. a 68. c 75. c 82. b 89. d 96. d 103. b 69. b 76. b 83. c 90. b 97. a 104. a 70. c 77. c 84. a 91. a 98. d *105. d 71. c 78. a 85. b 92. b 99. a *106. c MULTIPLE CHOICE —CPA Adapted 110. According to the FASB's conceptual framework, the process of reporting an item in the financial statements of an entity is 111. Green Construction Co. has consistently used the percentage-of-completion method of recognizing revenue. During 2010, Green entered into a fixed-price contract to construct an office building for $12,000,000. Information relating to the contract is as follows: At December 31 2010 2011 Percentage of completion 15% 45% Estimated total cost at completion $9,000,000 $9,600,000 Gross profit recognized (cumulative) 600,000 1,440,000 Contract costs incurred during 2011 were 18 - 26
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Revenue Recognition 112. Bruner Constructors, Inc. has consistently used the percentage-of-completion method of recognizing income. In 2010, Bruner started work on a $35,000,000 construction contract that was completed in 2011. The following information was taken from Bruner's 2010 accounting records: Progress billings $11,000,000 Costs incurred 10,500,000 Collections 7,000,000 Estimated costs to complete 21,000,000 What amount of gross profit should Bruner have recognized in 2010 on this contract? 113. During 2010, Gates Corp. started a construction job with a total contract price of $3,500,000. The job was completed on December 15, 2011. Additional data are as follows: 2010 2011 Actual costs incurred $1,350,000 $1,525,000 Estimated remaining costs 1,350,000 Billed to customer 1,200,000 2,300,000 Received from customer 1,000,000 2,400,000 Under the completed-contract method, what amount should Gates recognize as gross profit for 2011? a. $225,000 b. $312,500 c. $475,000 d. $625,000 114. Hogan Farms produced 800,000 pounds of cotton during the 2010 season. Hogan sells all of its cotton to Ott Co., which has agreed to purchase Hogan's entire production at the prevailing market price. Recent legislation assures that the market price will not fall below $.70 per pound during the next two years. Hogan's costs of selling and distributing the cotton are immaterial and can be reasonably estimated. Hogan reports its inventory at expected exit value. During 2010, Hogan sold and delivered to Ott 600,000 pounds at the market price of $.70. Hogan sold the remaining 200,000 pounds during 2011 at the market price of $.72. What amount of revenue should Hogan recognize in 2010? 18 - 27
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