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Question:
Tallahassee Builders, Inc. signed a contract to prepare a certain project for $4,000. In 2010, $800 of cost was incurred and $400 was billed to the customer and collected. At the end of 2010, it was evaluated that it would take $2,400 to complete the project. In 2011, actual additional costs to complete the project amounted to $2,600. The remainder of the contract price was billed in 2011 and collected.
Prepare journal entries for 2010 using the Completed-contract method.
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