90.2K

Verified Solution

Link Copied!

I DON'T KNOW WHAT I'M DOING WRONG ON THE QUESTIONS I GOT INCORRECT. PLEASE HELP.

On February 1, 2016, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,025,000. During 2016, costs of $2,010,000 were incurred, with estimated costs of $4,010,000 yet to be incurred. Billings of $2,512,000 were sent and cash collected was $2,260,000.

In 2017, costs incurred were $2,512,000 with remaining costs estimated to be $3,615,000. 2017 billings were $2,762,000, and $2,485,000 cash was collected. The project was completed in 2018 after additional costs of $3,810,000 were incurred. The companys fiscal year-end is December 31. This project does not qualify for revenue recognition over time.

Required:

1.

Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years. 2-a. Prepare journal entries for 2016 to record the transactions described (credit "various accounts" for construction costs incurred). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2-b. Prepare journal entries fo 2017 to record the transactions described (credit "various accounts" for construction costs incurred). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 3-a. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2016. (Do not round intermediate calculations. Round your answers to the nearest dollar amount.) 3-b. Prepare a partial balance sheet to show the presentation of the project as of December 31, 2017. (Do not round intermediate calculations. Round your answers to the nearest dollar amount.)

Required: 1. Calculate the amount of revenue and gross profit or loss to be recognized in each of the three years Answer is complete but not entirely correct Gross profit (loss) Revenue Year recognize recognize 2,679,444X 669, 444X 2016 1,780,314X 2017 (781,444)X 3,565,242X (195,000) 2018 30 7.000 8,025,000 Total

Answer & Explanation Solved by verified expert

See Answer