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What portion of the total contract price

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Question - Meyer Corporation uses the percentage-of-completion method to account for work performed under long-term construction contracts. Meyer began work under contract #7031-21, which provided for a contract price of $3,645,000. Additional data is as follows:

2007 2008

Costs incurred during the year 563,000 1,764,000

Estimated costs to complete, as of Dec 31 1,500,000 -0-

Billings during the year 580,000 2,875,000

Collections during the year 525,000 2,670,000

Instructions:

(a) What portion of the total contract price would be recognized as revenue in 2007 and in 2008?

(b) Prepare a complete set of journal entries for 2008 under the percentage-of-completion method?

Reference no: EM131795298

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