Required information
[The following information applies to the questions
displayed below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
2018 | 2019 | 2020 | |||||||
Cost incurred during the year | $ | 2,100,000 | $ | 2,450,000 | $ | 2,695,000 | |||
Estimated costs to complete as of year-end | 4,900,000 | 2,450,000 | 0 | ||||||
Billings during the year | 2,200,000 | 2,350,000 | 5,450,000 | ||||||
Cash collections during the year | 1,900,000 | 2,300,000 | 5,800,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
rev: 09_15_2017_QC_CS-99734
Required:
1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. (Do not round intermediate calculations. Loss amounts should be indicated with a minus sign.)
Solution
2018 | 2019 | 2020 | |
Revenue | $ 3,000,000 | $ 3,500,000 | $ 3,500,000 |
Gross profit | $ 900,000 | $ 1,050,000 | $ 805,000 |
Working
Working | 2018 | 2019 | 2020 | |
A | Contract Price | $ 10,000,000 | $ 10,000,000 | $ 10,000,000 |
B | Cost Incurred to Date | $ 2,100,000 | $ 4,550,000 | $ 7,245,000 |
C | Estimated cost yet to be incurred to complete the contract | $ 4,900,000 | $ 2,450,000 | $ 0 |
D = B+C | Total Cost | $ 7,000,000 | $ 7,000,000 | $ 7,245,000 |
E = (D/B) x 100 | % of Completion | 30% | 65% | 100% |
F = A x E | Revenue to date | $ 3,000,000 | $ 6,500,000 | $ 10,000,000 |
G | Revenue of Previous year | $ 0 | $ 3,000,000 | $ 6,500,000 |
H = F - G | Net Revenue this year | $ 3,000,000 | $ 3,500,000 | $ 3,500,000 |
I | Cost to date | $ 2,100,000 | $ 4,550,000 | $ 7,245,000 |
J | Cost to date of previous year | $ 0 | $ 2,100,000 | $ 4,550,000 |
K = I - J | Net Cost for the year | $ 2,100,000 | $ 2,450,000 | $ 2,695,000 |
L = H - K | Gross Profits | $ 900,000 | $ 1,050,000 | $ 805,000 |
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,100,000 $ 2,450,000 $ 2,695,000 Estimated costs to complete as of year-end 4,900,000 2,450,000 0 Billings during the year 2,200,000 2,350,000 5,450,000 Cash collections during the...
in 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,100,000 $ 2,450,000 $ 2,695,000 Estimated costs to complete as of year-end 4,900,000 2,450,000 0 Billings during the year 2,200,000 2,350,000 5,450,000 Cash collections during the year 1,900,000 2,300,000 5,800,000 Westgate recognizes revenue over time according to...
In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: during the year $2,100,000 $2,450,000 $2,695,000 Estimated costs to complete as of year-end Billings during the year Cash collections during the year 4,900,000 2,450,000 2,200,000 2,350,000 5,450,000 1,900,000 2,300,000 5, 800,000 3 28 Westgate recognizes revenue over time according to percentage of completion Required: ances 1....
Required information The following information applies to the questions displayed below) In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2020 $2,200,000 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2018 $2,400,000 5,600,000 2,000,000 1,800,000 2019 $3,600,000 2.000.000 4,000,000 3,600,000 4.000.000 4.600.000...
The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,490,000 $ 3,984,000 $ 2,008,600 Estimated costs to complete as of year-end 5,810,000 1,826,000 0 Billings during the year 2,030,000 4,444,000 3,526,000 Cash collections during the year 1,815,000...
[The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,490,000 $ 3,984,000 $ 2,008,600 Estimated costs to complete as of year-end 5,810,000 1,826,000 0 Billings during the year 2,030,000 4,444,000 3,526,000 Cash collections during the year 1,815,000...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,204,000 $ 3,192,000 $ 2,424,400 Estimated costs to complete as of year-end 5,396,000 2,204,000 0 Billings during the year 2,140,000 3,256,000 4,604,000 Cash collections during...
Required information The following information applies to the questions displayed below) In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2020 $2,200,000 Coat incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2018 $2,400,000 5,600,000 2,000,000 1,800,000 2019 $3,600,000 2,000,000 4,000,000 3,600,000 4,000,000 4,600,000...
Required information (The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2020 $1,940,400 Cost incurred during the year Estimated costs to complete as of year-end Billings during the year Cash collections during the year 2018 $ 2,604,000 5,796,000 2,040,000 1,820,000 2019 $4,032,000 1,764,000 4,596,000 4,000,000 3,364,000...
Required information [The following information applies to the questions displayed below.] In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: 2018 2019 2020 Cost incurred during the year $ 2,204,000 $ 3,192,000 $ 2,424,400 Estimated costs to complete as of year-end 5,396,000 2,204,000 0 Billings during the year 2,140,000 3,256,000 4,604,000 Cash collections during the...