Question

Problem 18-11

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On July 1, 2017, Coronado Construction Company Inc. contracted to build an office building for Gumbel Corp. for a total contract price of $1,880,000. On July 1, Coronado estimated that it would take between 2 and 3 years to complete the building. On December 31, 2019, the building was deemed substantially completed. Following are accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Gumbel for 2017, 2018, and 2019.

		At 12/31/17		At 12/31/18		At 12/31/19
Contract costs incurred to date		$286,900		$1,122,900		$2,066,700
Estimated costs to complete the contract		1,223,100		847,100		–0–
Billings to Gumbel		300,000		1,100,000		1,830,000

(a) Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2017, 2018, and 2019. (Ignore income taxes.)

(b) Using the completed-contract method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2017, 2018, and 2019. (Ignore income taxes.)

Answer 1

-a Tencentege Coneplehao_Method 2012 Cost to date $286900 Eshmaled cost to complete - $ 1223.100 Estimated Talal. Costa $ 1510,000 Pencakage. Conspieled is l_19%. Total Camilroca - 1 price Revenue Recognised ai $357200 [1860,000 197] Costa Powered $ Beans pohit Belsaniedio $ 57200 2012 l 2018.- Cost incurled till date a $ Gabmated cost to complete $ Estimated Total code = $ 1,122,900 847,100 19,70.000 108 percentage completed _ i Cost intueried_ Ghinated Tota/Cack_ $1122900 5571 $1970000 Revenue herlognition : [18480,000x 57'%] و فهمت انها $ 171602 $ 100 000 28400, hoss Relogused in 2018

و _2009 مه662م2 هو المهيمن ايها المما 1 Ehnated buto.complet 3 Estimated Tuted cock £ 20564 $ 2,0651200 Percentage completan 100 to Rewenice Reugnised .; $ 210661703. I favs. jocelled ? :$ 18,30,000 swofit Recogarjetas $ 2,364700 ben 2016 Percentage completion Method leta 2017 yen lain how - Revenue to be Recoquined o 2018: Revenue to be Reuquesed o dolg $ 52200 $28400 + $.236 700 - & 265, soo