What amount of revenue is recognized

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Problem - In 20x1, Gorgeous Too Co. enters into a fixed-price construction contract with a customer. At contract inception, Gorgeous Too Co. assesses its performance obligations in the contract and concludes that it has a single performance obligation that is satisfied over time. Gorgeous Too Co. determines that the measure of progress that best depicts its performance on the contract is input method based on costs incurred. Information on the contract follows:

 

20x1

20x2

Cumulative contract costs incurred

2,250,000

4,800,000

Cumulative profits recognized

750,000

1,200,000

Progress billings

2,400,000

3,600,000

Collections on progress billings

2,000,000

4,000,000

The contract is completed in 20x2. What amount of revenue is recognized in 20x2?

Reference no: EM132726431

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