Reference no: EM132894326

Lions Construction Company is a 12/31 year-end company for reporting purposes. In 2010, the Lions entered into a building contract for $200 million in downtown Fullerton. The building project was completed in 2012.

Information ($ in millions) related to the contract is as follows:

                                                                             2010               2011                2012
Cost incurred during the year                      $30                 $50              $70
Estimated costs to complete as of year end    $100                 $80              $0

Problem 1: Assuming that Lions used the percentage-of-completion method, how much ($ in millions) is the revenue recognition in 2010?

Select one:

a. 58
b. 30
c. 16
d. 46

Problem 2: Assuming that Lions used the percentage-of-completion method, how much ($ in millions) is the gross profit in 2010?

Select one:

a. 70
b. 16
c. 30
d. 0

Problem 3: Assuming that Lions used the completed contract method, how much ($ in millions) is the revenue recognition in 2012?

Select one:

a. 200
b. 120
c. 180
d. 0