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Questions -
Q1. On July 1, 2026, Behalf Construction Corporation contracted to build an office building for Bewhole Inc. for a total contract price of 975,000.
2016
2017
2018
Contract cost incurred to date
75,000
600,000
1,050,000
Estimated cost to complete
675000
400,000
-
Billings to Bewhole Inc.
150,000
550,000
275,000
Under the percentage of completion method, how much is the realized gross profit/(loss) at December 31, 2018?
a. (50,000)
b. (75,000)
c. (100,000)
d. (25,000)
Q2. You determined the following information from a certain P2,000,000 fixed-price construction contract:
2026
2027
2028
Gross profit (loss) each year
50,000
175,000
(25,000)
Costs incurred each year
450,000
?
1,025,000
Determine the estimated total gross profit on the project as of 12/31/2027
a.450,000
b. 550,000
c.400,000
d.225,000
Financial Statement Analysis and Preparation
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