Jorg is building an office building for Wilmington

Company for #2575

Jorg is building an office building for Wilmington Company for $ 20,000,000. The contract has
the following characteristics: • The office building is built to the customer’s specifications and
the customer can make changes to these specifications over the contract term.• Progress
payments are made by the customer throughout construction. • The customer can cancel the
contract at any time ( with a termination penalty); any work in process is the property of the
customer. Jorg provides you with the following details:Required: 1. Calculate the estimated total
gross profit on the contract as of December 31, 2017, 2018, and 2019. 2. Calculate the
percentage of completion for 2017, 2018, and 2019. 3. Calculate the amount of income ( loss)
Jorg will recognize for 2017, 2018, and 2019. 4. Prepare all journal entries related to this project
for Jorg for all 3 years. 5. How will this project be carried on the balance sheet for 2017, 2018,
and 2019? View Solution:
Jorg is building an office building for Wilmington Company for

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