Quiz Solutions Essay

Quiz Alternatives

1. Percentage-of-completion and completed-contract methods (6 points). In February you, 2014, Brian Stevens agreed to construct a building for a contract cost of $5, 800, 500. The job would be done in 2016. Information relating to the costs for this contract is really as follows:

2014 2015 2016

Total costs incurred to date$1, 500, 000$2, 640, 000$4, 600, 1000 Estimated costs to complete2, 500, 0001, 760, 000-0-

Instructions

Fill out the correct portions on the next schedule. Intended for percentage-of-completion accounting and for completed-contract accounting, demonstrate Brian's major profit that ought to be recorded to get 2014, 2015, and 2016.

Percentage-of-Completion Completed-Contract

Gross ProfitGross Profit

20142014

20152015

20162016

Solution

Percentage-of-CompletionCompleted-Contract

Gross ProfitGross Revenue

2014$675, 0002014 0

2015$165, 0002015 0

2016$360, 0002016$1, 200, 1000

Computation Process:

Percentage-of-completion methods

2014

$1, 500, 000

————— × $5, 800, 500 = two, 175, 1000

$4, 000, 1000

2, 175, 000 -- $1, 500, 000 = $675, 500

2015

$2, 640, 000

————— × $5, 800, 000 sama dengan 3, 480, 000

$4, four hundred, 000

(3480000 - 2175000) - (2, 640, 1000 - you, 500, 000) = $165, 000

2016

(5, 800, 000 - 3480000) -- (4, 600, 000 - 2, 640, 000) sama dengan $ 360, 000

Completed-contract methods

2014:

0

2015:

0

2016:

5, 800, 000 - 4, six hundred, 000 sama dengan $1, 2 hundred, 000

2 . Percentage-of-completion and completed-contract strategies (4 points). On March, 2014, Brian Stevens agreed to construct a building at a contract price of $5, 800, 500. The job would be done in 2016. Information concerning the costs just for this contract is really as follows:

2014 2015 2016

Total costs received to date$1, 500, 000$3, 640, 000$6, 000, 000 Estimated costs to complete2, 500, 0002, 760, 000-0-

Instructions

Fill out the correct amounts on the subsequent schedule. Pertaining to percentage-of-completion accounting and for...