Reference no: EM133177813

Questions -

Q1. In Year 1, a contractor agrees to build a building for $2,500,000 by the end of Year 2. The builder's cost is estimated to be $1,800,000. The actual costs for Year 1 are $900,000 and Year 2's actual costs are $1,100,000. Under the percentage of completion method Year 1's gross profit is?

A. $350,000.

B. $0.

C. $700,000.

D. $300,000.

Q2. Terry has sold equipment used in her business. She acquired the equipment three years ago for $50,000 and has recognized $30,000 of depreciation across the years in use. In order to recognize any Sec. 1231 gain, she must sell the equipment for more than?

A. $0.

B. $20,000.

C. $30,000.

D. $50,000.