Question

Question 6 2.5 pts Katheryn Hudson Corp. hired an employee on November 1, 2020. The employee will be paid an hourly wage of $20. The employee worked 150 hours during November and was paid $3,000 on December 7. The employee worked 160 hours during December and will be paid $3,200 on January 7, 2021. How much in wages expense for this employee will Hudson report in its fourth- quarter income statement, ending December 31, 2020? (just enter the number, without any commas or a dollar sign) Question 7 2.5 pts In 2020, Abel Tesfaye Corp. began a three-year, long-term construction project that qualified for revenue recognition over time. Tesfaye's customer agreed to pay $300,000. By the end of 2020, Tesfaye had spent $60,000 on the project and expected to spend an additional $180,000 over the next two years. Tesfaye measures progress toward completion based on costs incurred. How much revenue will Tesfaye report on the project in its 2020 income statement? (just enter the number, without any commas or a dollar sign)

Answer 1

Question 6

$3,200

Reason : The expense incurred in present and to be paid in future must be recognised in the period incurred itself.

Question 7

$75,000

Reason : The revenue to be reported is calculated on basis ratio of expense incurred in the period.

Total expense = 60,000+ 180,000

= 240,000

Revenue to be recognised :

= 300,000*60,000/ 240,000

= $ 75,000

Question 8

$ 120,000

Reason : As there is chance of 70% of contingent fee to be paid the total amount that will be paid is recognised as an revenue.