A. Construction In Progress 720,000.

00
Cash 720,000.00

Contract Price 2,000,000.00

Percentage of Completion 40%
Revenue to date 800,000.00
Revenue recognized in previous yrs. 0
Revenue for the y. 800,000.00
Cost of construction -720000
Gross Profit for the yr. 80,000.00

B. Cost of construction 720,000.00

AJE Construction In Progress 80,000.00
Revenue 800,000.00

Case 1
C. Receivable 800,000.00
Contract Asset 200,000.00
Progress billings 1,000,000.00

Case 2
D. Receivable 800,000.00
Progress billings 500,000.00
Contract liability 300,000.00
Case 1
a. Receivable
800,000
800,000

b. Contract Asset /Contract Liability

Construction in Progress Progress billings

720,000 1,000,000
80,000 1,000,000
800,000

Contract Cost Incurred 720,000

Profit earned 80,000
Total 800,000

Progress Billings 1,000,000

Contract Libaility 200,000

Progress Billings 1,000,000

Construction in Progress 800,000
Contract Liability 200,000

Case 2 Receivable
800,000
800,000

Construction in Progress Progress billings

720,000 500,000
80,000 500,000
800,000

Contract Libaility
300,000
300,000

Contract Cost Incurred 720,000

Profit earned 80,000
Total 800,000

Progress Billings 500,000

Contract Libaility 300,000
Progress Billings 500,000
Contract Asset 300,000
Construction in Progress 800,000