On July 1, 2020, Cullumber Construction Company Inc. contracted to build an office building for Gumbel Corp. for a total

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On July 1 2020 Cullumber Construction Company Inc Contracted To Build An Office Building For Gumbel Corp For A Total 1 (156.85 KiB) Viewed 54 times

On July 1, 2020, Cullumber Construction Company Inc. contracted to build an office building for Gumbel Corp. for a total contract price of $1,900,000. On July 1, Cullumber estimated that it would take between 2 and 3 years to complete the building. On December 31, 2022, the building was deemed substantially completed. Following are accumulated contract costs incurred, estimated costs to complete the contract, and accumulated billings to Gumbel for 2020, 2021, and 2022. At 12/31/20 At 12/31/21 At 12/31/22 Contract costs incurred to date $319,200 $1,134,300 $2,082,500 Estimated costs to complete the contract 1,200,800 855,700 -0- Billings to Gumbel 310,000 1,110,000 1,850,000 (a) Using the percentage-of-completion method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2020, 2021, and 2022. (Ignore income taxes.) (If answer is 0, please enter 0. Do not leave any field blank. If an amount should be deducted then enter the amount using either a negative sign prececeding the number e.g. -45 or parenthesis e.g. (45).)
2020 Estimated Costs to Complete $ 1,200,800 Costs to date (12/31/20) 319,200 Estimated Total Costs $ 1,520,000 ► Percent Complete 21 % Costs Incurred tA 319,200 Revenue Recognized 239,400 Profit /(Loss) Recognized in 2020 $ 79,800
2021 Estimated Costs to Complete 855,700 Costs to date (12/31/21) 1,134,300 Estimated Total Costs 1,990,000 Contract Price 2,041,300 Total Profit/Loss $ ta (51,300) Estimated Total Costs $ (210,900) Gross Profit Recognized in 2020 79,800 Profit /(Loss) Recognized in 2021 A $ (131,100)
2022 Estimated Costs to Complete $ 0 Costs to date (12/31/22) 2,082,500 2,082,500 Contract Price Estimated Total Costs $ Total Profit/Loss $ 182,500 Profit/(Loss) Recognized in 2020 - $ 79,800 Profit/(Loss) Recognized in 2021 131,100 51,300 Profit/(Loss) Recognized in 2022 $ 131,200
(b) Using the completed-contract method, prepare schedules to compute the profit or loss to be recognized as a result of this contract for the years ended December 31, 2020, 2021, and 2022. (Ignore income taxes.) (If answer is 0, please enter 0. Do not leave any fields blank. If an amount should be deducted then enter the amount using either a negative sign prececeding the number e.g.-45 or parenthesis e.g. (45).) 2021 Estimated Costs to Complete 855,700 Contract Price 1,900,000 Profit/(Loss) Recognized in 2021 - $ 1,044,300 2022 Costs Incurred $ 1,717,500 Contract Price 1,900,000 Total Profit/(Loss) on Contract 182,500 Profit/(Loss) Recognized in 2021 1,044,300 Profit/(Loss) Recognized in 2022 $ 1,226,800