Solution-Determine the amount included as current asset

Determine the amount included as current asset

Reference no: EM132783571

On January 1, 2019, STAR CORP, a real estate company, entered into a contract to construct a building on a piece of land . When construction is complete, it will deliver the entire property to a customer.

The following information pertains to the said contract:

Total cost of land - 2,000,000
Estimated total cost of construction - 8,000,000
Estimated total cost of contract - 10,000,000
Agreed purchase price - 11,000,000

In 2019, total construction cost incurred amount to 2,000,000 while fair value of the land is 2,500,000. The contract is considered to be a multiple contract.

Problem 1: Determine the amount included as current asset in the financial statements of STAR related to the above information under zero profit method.

a) 4,000,000
b) 4,500,000
c) 2,500,000
d) 2,000,000

Reference no: EM132783571

Questions Cloud

How can record the transactions on the trial balance : How can record the transactions on the trial balance column on the worksheet? How to record adjustments onto the adjustments column

Who was the most important composer of concert band music : Who was the most important composer of concert band music in the late 1800's? What three traits does his music share with Stephen Foster and George M. Cohan?

Explain income-tax-exempt enterprise : The cafeteria you operate has a regular clientele for all three meals, seven days a week. You want to expand your product line beyond

Prepare its journal entries for purchase of the investment : Assuming Bridgeport Corporation applies IFRS, prepare its journal entries for the purchase of the investment and the receipt of semi-annual interest

Determine the amount included as current asset : Determine the amount included as current asset in the financial statements of STAR related to the above information under zero profit method.

How women have made history and significant contributions : Research how women have made history and significant contributions through their service in the Armed forces and how those contributions have impacted.

Explain real rate of interest and inflation? rate : What would you expect the nominal rate of interest to be if the real rate is 4.2?% and the expected inflation rate is ?6.8%?

Why does jefferson not discuss slavery in the declaration : Read Thomas Paine Calls for American Independence, 1776 and the Declaration of Independence, 1776 under VIII in the Primary Sources at the end of Chapter 5.

What are the financial statements that must be prepared : What are the financial statements that must be prepared by a private college or university and those that must be prepared by a public college or university?

User Account

All Pages

Determine the amount included as current asset

Reference no: EM132783571

Reference no: EM132783571

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT