Reference no: EM132561102
Question - Big Construction Company signs a contract on 1 July 2019, agreeing to build a warehouse for Buyer Corporation Ltd at a fixed contract price of $10 million. Buyer Ltd will be in control of the asset throughout the construction process. Big Construction Company estimates that construction costs will be as follows:
2019 2.5 million
2020 $4 million
2021 $1.5 million
The contract provides that Buyer Corporation Ltd will make payments on 31 December each year as follows:
2019 $2 million
2020 $5 million
2021 $3 million
The contract is completed and accepted on 31 December 2021. Assume that actual costs and cash collections coincide with expectations and that cost (an input measure) is used as the basis for assessing progress on the construction contract. Big Construction Company has a financial year ending 31 December.
Required -
a) Using the above data, compute the gross profit to be recognised for each of the three years, assuming that the outcome of the contract can be reliably estimated.
b) Prepare the journal entries for 2019, 2020 and 2021 financial year to recognise revenue on the assumption that the measure of progress on the contract can be reliably estimated.
c) Prepare the journal entries for 2019, 2020 and 2021 financial year, assuming that the measure of progress on the contract cannot be reliably assessed.
|
What are the cost of goods sold and the cost of work
: What is the cost of goods manufactured? What are the cost of goods sold and the cost of work in process on January 1. 2022, respectively?
|
|
Identify the nursing framework or theoretical perspective
: Using the Week 5 research template identify the research components, listed on the template. Select a nursing research article from the list below and address.
|
|
What is the minimum amount that it must submit
: Jenkins Corporation had $675,000 of taxable income for 2018 and $575,000 for 2019. What is the minimum amount that it must submit
|
|
What was the nursing leaders response to the crisis
: What was the nursing leaders' response to the crisis? Relate the response to the theories you learned in this course and the Crisis Leadership article.
|
|
Prepare the journal entries for financial year
: Prepare the journal entries for 2019, 2020 and 2021 financial year, assuming that the measure of progress on the contract cannot be reliably assessed
|
|
General sense of body rhythms
: 1. What is your general sense of your body's rhythms?
|
|
Calculate the profit or loss position of futures transaction
: Three months later, when the manager closes out the position, the contract is trading at 2512. Calculate the profit or loss position of the futures transactions
|
|
Prospective legal issues and regulations
: In order to be successful in the student affairs profession, you must be knowledgeable of current, past, and prospective legal issues and regulations
|
|
Prepare journal entries to record the missing transactions
: Computer Games Ltd reported a profit of $53,950 for the year ending 31 December 2016. Prepare journal entries to record the missing transactions
|