In 2013 tommys construction corp began construction work

Reference no: EM13572910

In 2013, Tommy's Construction Corp began construction work under a three- year contract. The contract price is $1,600,000. They use the percentage-of-completion method for financial reporting purposes. The financial statement presentation relating to this contract at December 31, 2013, is as follows:

Balance Sheet

Accounts receivable (from construction progress billings) Construction in progress

$ 100,000

$ 30,000

Less: Billings on construction contract

Cost of uncompleted contracts in excess of billings

(94,000)

6,000

Income Statement

Income (before tax) on the contract recognized in 2013 $ 20,000

Required:

What was the cost of construction actually incurred in 2013?
How much cash was collected in 2013 on this contract?
What was the estimated cost to complete as of the end of 2013?
What was the estimated percentage of completion used to calculate income in 2013?

Reference no: EM13572910

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