Burtie is in the process of constructing a number of assets for its customers, the details of which can be found below.

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Burtie Is In The Process Of Constructing A Number Of Assets For Its Customers The Details Of Which Can Be Found Below 1 (35.24 KiB) Viewed 28 times

Burtie is in the process of constructing a number of assets for its customers, the details of which can be found below. Contract 1: Contract 1 has a price of $8 million and is 40 % complete. Contract 1 is estimated to have total costs of $5 million, of which Burtie has spent $2 million to date. Burtie has received $1.5 million from the customer to date. Contract 2: Contract 2 has a price of $7 million and is 60% complete. Due to rising raw material costs, contract 2 now has estimated total costs of $9 million. Contract 3: Contract 3 has a price of $6 million but only began 1 month ago so its progress cannot be measured. Burtie has incurred costs to date of $100,000 out of total estimated costs of $4 million, and is expected to take three years to complete the contract. Required: (a) Determine the correct amount to be recorded in current assets in relation to contract 1? (8 Marks) (b) Determine the correct amount to be recorded in cost of sales in relation to contract 2? (6 Marks) (c) Determine the correct amount to be recorded in revenue in relation to contract 3? (2 Marks)