Compute the gross profit recognized during the year

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Question - On January 1, 2014, Beckwith Co. obtained a contract to construct a building. It was estimated at the beginning of the contract that it would take three years to complete the project at an expected cost of $200,000. The contract price was $250,000. The following information describes the status of the job at the close of production each year:

 

2014

2015

2016

Actual costs incurred

$110000

$115000

$15000

Estimated costs to complete

$100000

$20000

0

Required - Compute the items listed below for each year assuming the use of the percentage-of-completion cost-to-cost method.

1. Revenue recognized during the year.

2. Construction costs (expense) recognized during the year.

3. Gross profit recognized during the year.

Reference no: EM132850009

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