Calculate estimated gross profit that would be recognized

Assignment Help Accounting Basics
Reference no: EM133068085

Question - Wildhorse Construction Company has entered into a non-cancellable contract beginning January 1, 2020, to build a parking complex. It has been estimated that the complex will cost $615,000 and will take three years to construct. The complex will be billed to the purchasing company at $1,005,000. The following data pertain to the construction period.

 

2020

2021

2022

Costs to date

$276,750

$461,250

$625,000

Estimated costs to complete

338,250

153,750

0

Progress billings to date (non-refundable)

276,750

565,000

1,005,000

Cash collected to date

246,750

515,000

1,005,000

Required -

1. Using the percentage-of-completion method, calculate the estimated gross profit that would be recognized during each year of the construction period.

2. Using the completed-contract method, calculate the estimated gross profit that would be recognized during each year of the construction period.

Reference no: EM133068085

Questions Cloud

What recommendations can you make regarding the following : Furthermore, she makes a 401(k) contribution of $300 per month and $100 to her IRA montly. What recommendations can you make regarding the following
How boston books could help : a) What are some specific ideas for how Boston Books could help with the book drive? Provide two to three ideas.
What should janelle asset allocation be : What should Janelle's asset allocation be? Explain your answer.
Determining the payback period : Wilson's Market is considering two mutually exclusive projects. The required rate of return is 8% for Project A and 10% for Project B. Project A has an initial
Calculate estimated gross profit that would be recognized : Using the completed-contract method, calculate the estimated gross profit that would be recognized during each year of the construction period
Build a training center : What are some of the risks of a corporation using operating leverage to build a training center instead of paying to send its employees to outside training cour
Confidence interval for the true average : The weight (in grams) of the sugar contained in the packages of a certain brand is a random variable normally distributed. In order to analyze the average sugar
What is the required rate of return for twynam corp : Twynam Corp. has a beta of 1.3. The market risk premium is 8% and the risk-free rate is 3%. What is the required rate of return for Twynam Corp?
Calculate the new prices of bonds : Calculate the new prices of both bonds to illustrate your answer.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd