Software Technicians recently accepted a contract to develop an inventory management system for and Company....
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Software Technicians recently accepted a contract to develop an inventory management system for and Company. is required to complete the installation of the new inventory management system in two years. provided the following contract information. Contract price $1,590,000 2015 2016 Actual construction costs incurred during the year $191,880 $830,000 Construction costs incurred in prior years 0 191,880 Cumulative construction costs incurred to date $191,880 $1,021,880 Estimated costs to complete 447,720 0 Estimated total costs $639,600 $1,021,880 Progress billings made during the year $970,000 $620,000 Cash collections during the year $795,000 $795,000 a. Begin by recording the construction costs in 2015. b. Next record the progress billings in 2015. c. Now record the cash collections in 2015. d. Next record the gross profit in 2105. e. Now we will record the entries for 2016. Record the construction costs in 2016. f. Next record the progress billings in 2016. g. Now record the cash collections in 2016. h. Next record the gross profit in 2016. i. Finally, record the entry to close the completed contract in 2016.
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