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Question - Chicago contractors got $7,000,000 contract to construct a school building for the City of Chicago. Work on this contract began in 2016 and the financial data pertaining to this contract is available here.
Cost incurred till Dec.31, 2016$1,400,000Billings made to City$2,000,000Amount collected from City$1,500,000The estimated future cost to complete this contract is $4,200,000.
1. Prepare Chicago contractors 2016 journal entries using percentage of completion method.
2. Show how the contract accounts will appear in the Balance Sheet of Chicago Contractors on 12/31/2016.
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