What is the normal balance of construction in progress

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Question - Thompson Construction began a construction project in 2018. The contract price was $1,250,000, and the estimated costs were $1,000,000. Data for each year of the contract are as follows:

 

2019

2020

2021

Costs incurred during the year

$250,000

$600,000

$190,000

Estimated costs to complete

750,000

212,500

-0-

Partial billings

375,000

500,000

375,000

Collections

187,500

469,000

593,500

Required -

1) Prepare ALL journal entries for 2019/2020/2021?

2) Prepare 2019/2020/2021 balance sheet and income statement as illustrated in class examples?

3) What is the normal balance of Construction in Progress?

4) Why do you have to "close" Construction in Progress and Partial Billings at the end of the contract?

5) How complete is the contract on a contract to date basis at the end of 2020?

Reference no: EM133056641

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