Solution-Compute the amount of revenue and gross profit or

Compute the amount of revenue and gross profit or loss

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Reference no: EM132484068

Point 1: On February 1, 2018, Arrow Construction Company entered into a three-year construction contract to build a bridge for a price of $8,060,000. During 2018, costs of $2,020,000 were incurred with estimated costs of $4,020,000 yet to be incurred. Billings of $2,520,000 were sent, and cash collected was $2,270,000.

Point 2: In 2019, costs incurred were $2,520,000 with remaining costs estimated to be $3,630,000. 2019 billings were $2,770,000 and $2,495,000 cash was collected. The project was completed in 2020 after additional costs of $3,820,000 were incurred. The company's fiscal year-end is December 31. Arrow recognizes revenue over time according to percentage of completion.

Required:

Question 1. Compute the amount of revenue and gross profit or loss to be recognized in 2018, 2019, and 2020 using the percentage of completion method?

Reference no: EM132484068

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Compute the amount of revenue and gross profit or loss

Reference no: EM132484068

Reference no: EM132484068

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