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Calculate the amount of gross profit to the recognized

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Reference no: EM132784159

During 2020, ABC Construction Co. began a construction job with a contract price of S2.8 million. The job was completed in 2022. The data below is available:

                                                         2020                 2021                2022

Costs Incurred to Date          $1,000,000        $1,600,000   $1,800,000
Estimated Costs to Complete  $1,100,000            $400,000    $0
Billirtp to Date                   $1,050,000 $         2,150,000   $2,800,000
Collections to Date           $900,000                 $2,100,000       $2,800,000

  • ABC Construction Co. follows IFRS and therefore, uses the percentage-of-completion method to account for its Tong-terra contracts.

Required:

Round all currency to 2 decimal places. Round all percentages to 7 decimal places.

Problem 1: Determine the percentage complete for the end of 2020, 2021 and 2022.

Problem 2: Calculate the amount of gross profit to the recognized each year assuming the percentage-of-completion method is used.

Reference no: EM132784159

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