Professional Documents
Culture Documents
Problem 1
2015 2016
Total Contract Price 7,000,000.00 7,000,000.00
Cost incurred to date 1,650,000.00 5,750,000.00
Estimated costs to complete 3,500,000.00
Total Estimated costs 5,150,000.00 5,750,000.00
Expected Gross Profit 1,850,000.00 1,250,000.00
Percentage of Completion 32.04% 100%
Gross Profit Earned to Date 592,740.00 1,250,000.00
Less: GP earned in prior years 592,740.00
GP earned this year 592,740.00 657,260.00
2. Journal Entries
2015
Construction in Progress 1,650,000.00
Cash 1,650,000.00
Costs incurred
Cash 1,000,000.00
Accounts Receivable 1,000,000.00
Billings collections
2016
Construction in Progress 4,100,000.00
Cash 4,100,000.00
Costs incurred
Cash 3,700,000.00
Accounts Receivable 3,700,000.00
Billings collections
Problem 2
Problem 3
Project 1 Project 2
Contract Price 420,000 300,000
Cost Incurred 240,000 280,000
Estimated Cost to Complete 120,000 40,000
Total Estimated Costs 360,000 320,000
Estimated Gross Profit 60,000 (20,000)
Percentage of Completion 66.67% 100%
Recognized GP to date 40,000 (20,000)
Percentage-of-completion method
Recognized gross profit:
Project 1 40,000.00
Project 2 (20,000.00)
Gross Profit 20,000.00
Problem 4
PULAG PATOC
9-30-2015 9-30-2016 9-30-2015 9-30-2016
Contract Price 600,000.00
Penalties (40,000.00)
Contract Price 600,000 560,000 800,000 840,000
Cost Incurred 360,000 450,000 410,000 720,000
Estimated Cost to Complete 40,000 410,000 180,000
Total Estimated Costs 400,000 450,000 820,000 900,000
Estimated Gross Profit 200,000 110,000 (20,000) (60,000)
Percentage of Completion 90.00% 100% 100.00% 100%
Recognized GP to date 180,000 110,000 (20,000) (60,000)
Less: GP prior year 180,000 (20,000)
GP earned 180,000 (70,000) (20,000) (40,000)