Question

Brady Construction Company contracted to build an apartment complex for a price of $5,000,000. Construction began in 2021 and was completed in 2023. The following is a series of independent situations, numbered 1 through 6, involving differing costs for the project. All costs are stated in thousands of dollars.

											Estimated Costs to Complete
	Costs Incurred During Year										(As of the End of the Year)
Situation	2021			2022			2023				2021			2022			2023
1		1,500			2,100			900				3,000			900			—
2		1,500			900			2,400				3,000			2,400			—
3		1,500			2,100			1,600				3,000			1,500			—
4		500			3,000			1,000				3,500			875			—
5		500			3,000			1,300				3,500			1,500			—
6		500			3,000			1,800				4,600			1,700			—

Required:
Complete the following table. (Enter answers in dollars. Do not round intermediate calculations. Round your final answers to the nearest whole dollar. Negative amounts should be indicated by a minus sign.)

Gross Profit (Loss) Recognized Revenue Recognized Revenue Recognized Over Time Upon Completion 2022 2023 2021 2022 2023 0 0 Situation 2021

Answer 1

Answer

Gross Profit (Loss) Recognized Revenue Recognized Revenue Recognized Over Time Upon Completion 2021 2022 2023 2021 2022 2023 Situation

100,0000 100,0000 1. -100,000이 | | 166,667 | 166,667 | 166,667 125,0001 125,0000 -100,0001 233,333 -66,667 -266,667 375,0001 -125,000) -100,000 이 이 이 이 이 이 -100,0000 이 이 -100,000 500,000이 200,000 -100,000 500,000) 200,000) -100,000 0 200,0000 -100,0001 -100,0000

Calculations:

For 2021

Situation Cost Estimate % of Total Total Costs Gross Profit incurred Costs completion Contract Gross Margin incurred Recognized during the to Complete (C) = (A) + (B) (D) = (A)(C) Revenue (F) = (E)-(C) (G) = (F) (D) year (A) (B) 100 (E) 1,500,000 3,000,000 4,500,000 33.33% 5,000,000 500.000 166,667 1,500,000 3,000,000 4,500,000 33.33% 5,000,000 500,000 166,667 1,500,000 3,000,000 4,500,000 33.33% 5,000,000 500,000 166,667 500,000 3,500,000 4,000,000 12.50% 5,000,000 1,000,000 125,000 500,000 3,500,000 4,000,000 12.50% 5,000,000 1,000,000 125,000 500,000 4,600,000 5,100,000 9.80% 5,000,000 -100,000 -100,000|| 4 6

For 2022

Situation Cost incurred during the year (A) Estimate % of Total Total Costs Costs completion Contract Gross Margin incurred to Complete (C) = (A)+(B) D = (A)(C) Revenue 1) = (E)-(© 1 100 Gross Profit to be recognized (6) = (F)x(D) Gross Profit already recognized in 2016 (H) Gross Profit (Loss) recognized (1) = (G) - (H) (B) 1 2 3 4 3,600,000 2,400,000 3,600,000 3,500,000 ,500,000 3,500,000 900,000 2,400,000 1,500,000 875,000 1,500,000 1,700,000 4,500,000 4,800,000 5,100,000 4,375,000 5,000,000 5,200,000 80.00% 50.00% 70.59% 80.00% 5,000,000 5,000,000 5,000,000 5,000,000 500,000 200,000 -100,000 625,000 ol - 200,000 400,000 100,000 -100,000 500,000 166,667 166,667 166,667 125,000 125,000 -100,000 233,333 -66,667 266,667 375,000 -125,000 -100,000 5 3 6 67.31% 5,000,000 -134,615

For 2023

Cost incurred during the year Total Contract Revenue Situation Gross Margin (C)=(B)-(A) Gross Profit to be recognized (D) =(C) Gross Profit already recognized in 2016 (E) Gross Profit Total Gross Gross Profit already | Profit recognized in recognized in recognized till the year 2018 2017 2017 (G) = (E) + () (H) = (0)-(G) (B) 2 4 100.000 100.000 -100,000 3 4 4,500,000 .800,000 5,200,000 4,500,000 ,800,000 5,300,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 500,000 500.000 200.000 - 200,000 500,000 200,000 - 300,000 500,000 200.000 - 200,000 500,000 200,000 - 300,000 166,667 166,667 166,667 125,000 125,000 -100,000 233,333 -66,667 -266,667 375,000 -125,000 -100,000 400.000 100.000 -100,000 500,000 0 - 200,000 5 4 200,000 -100,000 6