Long-Term Construction Const ruction Contracts Contra cts
163
CHAPTER 10 MULTIPLE CHOICE ANSWERS AND SOLUTIONS
10-1: a Percentage of Completion Method: Contract Price Less:Total estimated cost Cost incurred Estimated remaining cost
P1,000,000 P 200,000 _400,000
Gross profit estimated of completion !200,000"600,000#
__600,000 400,000 __$$ 1"$
Gross profit to be recognized
P 133,333
Zero Profit Method:
0
10-: a P100,000
2007 Contract Price Less: Total estimated cost
2008
P%,000,000 P%,000,000 _&,'00,000 _',100,000
Estimated gross profit of completion: 200& !$,%00,000"&,'00,000# 200'!6,$00,000"',100,000#
1,200,000
%00,000
(0 _________ ______&'
Gross profit earned to date Less: Gross profit earned in prior )ear
600,000 &00,000 ________* ___600,000
Gross profit earned each year
P 60 600,000 P 10 100,000
10-!: a
Contract Price Less: Total estimated cost !$,600,000 + 1,200,000#
P6,000,000 _4,'00,000
Estimated gross profit of completion !$,600,000"4,'00,000#
1,200,000 _____&(
Gross profit earned to date Less: Gross profit earned in 200&
%00,000 __600,000
Gross profit earned in 200
P 300,000
Contract Price Less: Total estimated cost !%$0,000 + 2,1&0,000#
P$,000,000 _$,100,000
!oss
"P 100,000 #
10-": #
164 Chapter 10
10-$: #
Total cost to date, 200' !4,'00,000 60# Less: Cost incurred in 200& !4,(00,000 20#
P2,''0,000 __%00,000
Cost inc$rred in 200
P1,%0,000
Percentage Percentage of Completion Method: Method: Contract Price Less: Total estimated cost !%00,000"1,'00,000#
P$,000,000 _2,&00,000
10-%: a
Estimated gross profit of completion !%00,000"2,&00,000#
$00,000 ___$$-$$
Gross profit recogni.ed, 200& /dd: Cost ncurred
100,000 ___%00,000
Constr$ction in Progress & 200'
P 1,000,000
Zero Profit Profit Method: Cost inc$rred to Constr$ction in Progress & 200'
P
%00,000
10-&: a
2007
2008
Contract Price Less: Total estimated cost
P4,200,000 P4,200,000 _$,000,000 _$,&(0,000
Estimated gross profit of completion
1,200,000 _____20
4(0,000 ____100
240,000 _______*
4(0,000 __240,000
P 2(0,000
P 210,000
Gross Profit earned to date Gross Profit earned in prior )ear Gross Profit earned this year 10-': #
Collections: Contract illings Less: /ccounts receia3le
P 4&,000 ___1(,000
Collections
Initial Gross Gross Profit: Profit: Contract Price Gross Profit rate: ncome recogni.ed iide 3) Construction in Progress )nitial Gross Profit Profit
P
32,000
P '00,000 10,000 (0,000 5 _____20 P 160,000
Long-Term Construction Const ruction Contracts Contra cts
165
10-(: a
Gross profit !loss# earned in 200' Gross profit earned in prior )ears
!P 20 20,000# _1'0,000
Gross profit earned to date 200' iide 3) percentage of completion 200'
160,000 ___100
Estimated gross profit 200' Less: Contract price
160,000 2,000,000
Total estimated cost Less: Cost incurred 200'
1,'40,000 _'20,000
Cost incurred to date 200& Less: Cost incurred 2006
1,020,000 __$60,000
Cost inc$rred in 200'
P 660,000
Gross profit earned to date 200& !P40,000 + P140,000# iide 3) estimated gross profit 200&: Contract price P2,000,000 Gro Gross prof rofit rat rate 71 71'0,0 '0,00 00"!1 0"!1,0 ,02 20,000 ,000 + 1' 1'0,00 0,000# 0#88 ___ ___ 1(
P 1'0,000
10-10: #
Percentage of completion completion & 200'
__$0 __$00 0,000 ,000 60*
10-11: a) Refer to * 10-10 +o,tio.+/ 10-1: d
Contract price Estimated gross profit 200& !9efer to 1010# Total estimated cost Less: Cost incurred to date 200& !refer to 10%# +stimated cost to complete complete & 200'
P2,000,000 __$00,000 1,&00,000 1,020,000 P 60,000
10-1!: d
200&:
Construction in progress Less: Construction costs Gross profit recognized & 200'
200':
Construction in progress !P&2',000P244,000# Less: Construction costs Gross profit recognized & 200
P 244,000 __210,000 P 34,000 P 4' 4 '4,000 __$'4,000 P 00,000
166 Chapter 10
10-1": d
Pro!ect Pro!ect 2 Percentage Percentage of Completion Method: Method: Contract price P $00, $0 0,000 000 Less Less:: Total otal est estim imat ated ed cos costt Cost incurred to date 200' P 2'0,000 Estimated cost to complete ___&0,000
P 420,000
P 240,000 __120,000
Total __$(0,000
__$60,000
Estimated gross profit !Loss# !(0,000# Percentage of completion _______*
60,000 __66-6&
Profit "loss# to be recognized recognized "P 0,000 0, 000## -otal is "P10,000#
P (0,000
.ero Profit Method & -he loss loss "P0,000# for pro/ect 2 only 10-1$: a
200" Contract price !cost 120# P$,&44,000 Less Less:: Total otal esti estima mate ted d cost costss !1# Cost incurred to date $,120,000 Estimated cost to complete ________*
P$,&44,000 P$,&44,000
!2# _$,120,000
(46,000
1,(44,400
_2,0(4,000
_1,$1(,000
Total
_2,600,000
_2,'60,000
Estimated gross profit 624,000 Percentage of completion !1 2# 2# ____100
1,144,000
''4,000
_____20
_____(4
240,240
4&&,$60
_______*
__240,240
P 2(0,2(0
P 23',120
Gross profit earned to date 624,000 Gross profit earned in prior )ears __4&&,$60 Gross profit earned this year 1(6,6(0
2007
2008
P
10-1%: d
2007 Contract price P6,$00,000 Less Less:: Total otal est estim imat ated ed cos costt Cost incurred to date $,040,000 Estimated cost to complete _1,%60,000
P6,$00,000
Total P(,000,000
P(,(00,000
2008
1,42(,000 _4,0&(,000
Estimated gross profit 1,$00,000 Percentage of completion: 200& !1,42(,000 (0,000# (, ( ,(00,000 200' !$,040,000 (0,000# (,000,000 __(%-'0
'00,000
2( ________*
Profit earned to date &&&,400 Less: Gross profit earned in prior )ear __200,000
200,000 ________*
Gross profit earned this year P '',(00
P 200,000
Long-Term Construction Const ruction Contracts Contra cts
167
10-1&: a
Cas; collections: Progress 3illings Less: /ccounts receia3le, end
P1,(00,000 __(00,000
Collection
P1,000,000
Cost incurred to date: Construction in Progress Less: Gross profit earned
P1,600,000 __200,000
Cost inc$rred to date
P1,(00,000
10-1': d
Percentage of Completion
1,620,000
2008 1,620,000
#partment $ 2007 2,(20,000
2008
Less: Total Estimated Costs !1# Cost incurred to date P2,$10,000 Estimated cost to complete
P 60 600,000 P1,200,000 P1,(60,000
!2# Total estimated cost 2,$10,000 Estimated Gross Profit 210,000 Percentage of completion !1 2# 2# _100-00 Gross profit earned to date 210,000 Less: Gross profit earned in Prior )ears __1'&,200 ro++ Profit ear.ed thi+ ear 22,'00 -otal Gross Profit 20 "P',000 "P',00 0 P22,00#
'40,000
240,000
6%0,000
*
1,440,000
1,440,000
2,2(0,000
1'0,000
1'0,000
2&0,000
_41-6&
_'$-$$
_6%-$$
&(,000
1(0,000
1'&,200
_______*
___&(,000
_______*
P &(,000
P &(,000
P 1'&,000
P
P%',00
.ero Profit Method & P210,000 P210,000 gross profit earned in 200 for partment 10-1(: d
2007 Contract price: 200& 200' !P6,000,000P(0,000# P(,%(0,000 Less Less:: Total otal esti estima mate ted d cost costss !1# Cost incurred to date 2,6(0,000 Estimated cost to complete !2# 2,6(0,000
2008
P6,000,000 _________
2,$40,000 260,000
Total estimated cost
2,600,000
Estimated Gross Profit $,$00,000 Percentage of completion !1 2# 2# ___100
$,400,000
Gross profit earned to date $,$00,000 Less: Gross profit earned in Prior )ear $,060,000
$,060,000
*
____%0
_______*
Gross Profit earned this year
P3,060,000
P
2(0,000 168 Chapter 10
10-0: a 200" !1#Cost incurred to date
P$,400,000
2007 P(,%(0,000
2008
P6,1(0,000 !2#Estimated cost to complete !$#Total Estimated Costs 6,1(0,000 Percentage of completion !1
1,600,000
1(0,000
(,000,000
6,100,000
$#
Contract price P6,000,000 Less: Total estimated cost 6,1(0,000
6' P6,000,000 (,000,000
Estimated Gross Profit !1(0,000# Percentage of completion Gross profit earned !loss# to date !1(0,000# /dd: Cost incurred to date 6,1(0,000 Construction in Progress 6,000,000 Less: Contract 3illings 6,000,000 alance
%'
6,100,000 !100,000#
6'
100
$,400,000 4,0'0,000
100
P6,000,000
1,000,000
6'0,000
*
100
!100,000# (,%(0,000 (,'(0,000
$,200,000
(,200,000
P 0,000
P 60,000
4
10-1: 2 Construction in Progress: Cost incurred to date, 200& Gross profit earned, 200& !=c;edule 1# P2,&2(,000 Less: Contract 3illings, 2006 !P$,2(0,000 > &(# 2,4$&,(00
P2,62(,000 100,000
+5cess of Constr$ction Constr$ction in Progress Progress oer Contract Contract illings "C# P 2',00
%ched&le ' Computation Computation of gross profit earned, 2006 Contract price P$,2(0,000 Total estimated cost: Cost to date 2,62(,000 Estimated cost to complete &(0,000 Total $,$&(,000
200" P$,2(0,000
2007
1,0&(,000 1,612,(00 2,6'&,(00
Estimated gross profit !loss# !12(,000# of completion
(62,(00
Gross profit !loss# to date !12(,000# Gross profit earned in prior )ears 22(,000
22(,000
40
*
*
Gross profit earned t;is )ear P 100,0 10 0,000 00
P 22(,000
10-: a 200( 200" P2,'00,000 P2 P 2,'00,000
Contract price P2,'00,000 Estimated cost: Cost to date 2,440,000 Estimated costs to complete $'0,000
1,$00,000 1,$60,000
1,%60,000 &'0,000
Total 2,'20,000
2,660,000
+stimated gross gross profit "20,000#
140,000
* of completion Long-Term Construction Const ruction Contracts Contra cts
2007
2,&40,000 60,000
('*
'13*
169
10-!: # 00&
Pro!ect Pro!ect #
Pro!ect Pro!ect $
P2,%00,000
P$,400,000
1,6'0,000 1,120,000
1,440,000 1,&60,000
Pro!ect Pro!ect
C Contract price P 1,&00,00 1,&0 0,000 0 Estimated costs: Cost to date Estimated cost to complete %60,000 Total 1,2'0,000
2,'00,000
$,200,000
Estimated gross profit of completion
100,000 60
200,000 4(
ro++ 3rofit ear.ed thi+ ear 4P$$)0005 P 10(,00 10( ,000 0
P 60,000
P %0,000
Pro!ect Pro!ect #
Pro!ect Pro!ect $
Pro!ect Pro!ect C
P2,%00,000
P$,400,000
P1,&00,000
2,120,000 *0*
1,1'$,000 1,$60,000 1,$60,00 0
(60,000 11&,000
2,640,000
$,4'0,000
1,$00,000
00'
$20,000
420,000 2(
Pro!ect Pro!ect
) Contract price P 2,000,00 2,00 0,000 0 Estimated costs Cost to date2,640,000 Estimated costs to complete 1,040,000 Total 1,600,000 Estimated gross profit !loss# of completion
260,000 100
Gross profit !loss# to date Gross profit earned in prior )ear
260,000 60,000
ro++ 3rofit ear.ed thi+ ear4P%0()0005
P 200,0 20 0,000 00
!'0,000# *
400,000 %1
400,000 $(
!'0,000# $64,000 %0,000 10(,000
140,000 *0*
P 10,00 10 ,000 0
P 2(%,0 2( %,000 00
P 140,00 140 ,000 0 2007 P 2((,000
Gross profit earned P 60%,000 General and administratie e>penses 7et income
120,000 P 13,000
2008
120,000
P (%,000
10-": 2 Contract price P10,000,000 Gross profit earned to date, 200' !P%00,000 * P100,000#
'00,000
Total cost to date, 200' %,200,000 Less: cost incurred in 200' 4,100,000 Co+t to date) 00& P $)100) $)1 00)000 000
Gross profit earned to date
P
%00,000 iided 3) of completion: !P(,100,000 + P%00,000# " P10,000,000
60
+stimated gross gross profit, 200' P 1,00,000
10-$: d Construction in progress: Cost incurred to date P 440,000 Gross profit earned to date !P2,(00,000 * P2,000,000#
110,000
Total Less: Contract 3illings !P2,(00,000 > $0#
((0,000 &(0,000
+5cess of contract contract billings oer oer constr$ction in in progress "C!# "C!# P* 200,000+ P* 200,000+
170 Chapter 10
10-%: a
Contract price Total estimated cost: Cost incurred to date: =ite la3or cost Cost of of co construction ma materials eprec epreciat iation ion of specia speciall plant plant ? e@uip e@uip Total Estimated cost to complete Estimated gross profit Percentage of completion !4("100# ro++ 3rofit to #e re2o6.i7ed
P120,000,000
10,000,000 $0,000,000 (,000 (,000,00 ,000 0 4(,000,000 ((,000,000
100,000,000 20,000,000 4( P ()000)000
10-&: a
Cost incurred to date 200& Total es estimated co cost !' !',000,000 " 40# Estimated cost to complete Cost incurred in 200&
20,000,000 ',000,000
$,&00,000 Cost incurred in 2006 Estimated cost at completion 2006 Total estimated cost 2006
P12,000,000 $,&00,000
',$00,000 12,4(0,000 P20,&(0,000
Percentage of completion& completion& 2006 ",300,0008 20,'0,000# 20,'0,000# 9 (0* 10-': a
Contract price Total estimated cost: Cost incurred to date Estimated cost to complete Total estimated cost Estimated gross profit Percentage of completion Gross profit recogni.ed
200& Contract Contract 2 P600,000 P4(0,000 1(0,000 1(0,000 $00,000 $00,000 (0 P1(0,000
CIP2007
'&,(00 162,(00 2(0,000 200,000 $( P&0,000
P2$&,(00
P220,000
Contract
200' Contract 2
Contract
600,000 $(0,000 2(0,000 '0 200,000 1(0,000 (0,000
4(0,000 $00,000 1(0,000 60 %0,000 &0,000 20,000
%00,000 (00,000 400,000 $6 144,000 144,000
3 Contract price Total estimated cost Estimated gross profit Percentage of completion Gross profit earned to date Gross profit earned in 200& Gross profit earned t;is )ear
Long-Term Construction Const ruction Contracts Contra cts
171
10-(: a
Contract price Total estimated cost Cost incurred
$icol P'& P'&(,000 6(6,2(0
)a-ao #.lan P1,22(,00 ,000 P4$&,(0 ,(00 1&(,000
1&(,000
/otal
1,006,2(0
EstEst- cost cost to comp comple lete te Total otal esti estima mate ted d cost cost Estimated gross profit Perc Percen enta tage ge of comp comple leti tion on Gross prof rofit earned
Total cost incurred Total otal gros grosss prof profit it earn earned ed Construction in progress Less: illings $e from "to#
6(6, 6(6,2( 2(0 0 21',&(0 100 100 P21 P21',&(0
&00 &00,000 ,000 '&(, '&(,00 000 0 $(0,000 20 20 P &0,000
Percentage Percentage of completion 1,006,2(0 $$2, $$2,(0 (00 0 1,$$',&(0 1,$12,(00 26,20
1&(, 1&(,00 000 0 $(0, $(0,00 000 0 '&,(00 (0 (0 P4$,&(0
$$2,(0 ,(00
Zero Profit Profit 1,006,2(0 21', 21',&( &(0 0 1,22(,000 1,$12,(00 "',00#
10-!0: a
Contract price Total estimated cost: Cost incurred Estimated cost to complete Estimated gross profit Percentage of completion Gross profit recognized
P40,'2(,000 ',4&(,000 2',400,000
172
$6,'&(,000 $,%(0,000 22-%'$ P %0',30
Chapter Chap ter 10
SOLUTIONS TO PRO8LEMS Pro#,e9 10 1
!a#
2007 Contract Price
P 4(0,000
2008
P 4(0,0 4(0 ,000 00 Less Less:: Total otal est estim imat ated ed cos costt !1# Cost incurred to date Estimated costs to complete _______*
$20,000
!2# Total _$20,000
__$00,000
Estimated gross profit Percentage of completion !1 2# 2# ___100
1(0,000 ______2"$
1$0,000
Estimated gross profit to date Less: Gross profit earned in prior )ear __100,000
100,000 _______*
1$0,000
Gross profit earned t;is )ear $0,000 !3# !3#
200,000 __100,000
P 100,000P
Con Contrac tractt Price rice P 4(0,000 Less: Total cost incurred __$20,000 Gross profit P 1$0,0 1$0 ,000 00
!c#
200&:
200':
Construction in Progress Cost of construction Construction 9eenue Construction in Progress Cost of Construction Construction 9eenue
100,000 200,000 $00,000 $0,000 $20,000 $(0,000 Pro#,e9 10
!a# !a#
Cons Constr truc ucti tion on 9ee 9eenu nuee P1,2(0,000 Less: Cost incurred _1,2(0,000 Gross profit * 200'
P
0 * Construction in Progress !cost incurred# P1,2(0,000 Less: Contract 3illings !P(,'00,000 > $0# _1,&40,000 illings in e>cess of related costs P!4%0,000# !3# !3#
Con Contrac tractt price rice P(,'00,000 Less Less:: Total otal est estim imat ated ed cos costs ts Cost incurred to date
P1,2(0,000
*
Estimated costs to complete (,000,000
$,&40,000
Estimated gross profit Percentage of Completion !P1,2(0,000 (00,000# _____2(
'00,000
Gross profit P 200,0 200 ,000 00 Construction on Progress !P1,2(0,000 + P200,000# P1,4(0,000 Less: Contract 3illings _1,&40,000 illings in e>cess of related costs P!2%0,000# Long-Term Construction Const ruction Contracts Contra cts
173
Pro#,e9 10 ! 200(
!a#
Contract Price P((,000,000 P((,000,000 Less: Total estimated costs !1# Cost incurred to date 1(,000,000 (0,000,000 Estimated co costs to to complete _$(,000,000 ________* !2# Total (0,000,000 Estimated gross profit (,120,000 Percentage of completion !1 2# 2# ____100 Gross profit earned to date (,000,000 Gross profit earned in prior )r!s# _$,(00,000 Gross profit earned t;e )ear P 1,(00, 1,( 00,00 000 0
200"
2007
2008
P((,000,000
P((,000,000
2(,000,000
$(,000,000
2(,000,000
1(,000,000
_(0,000,000
(0,000,000
(0,000,000
(,000,000
(,000,000
(,000,000
______$0
_____(0
_____&0
1,(00,000
2,(00,000
$,(00,000
________*
_1,(00,000
_2,(00,000
P 1,(00,000
P 1,000,000
P 1,000,000
!3#
2007 !1# Construction in Progress Cas; or Pa)a3le 1(,000,000
1(,000,000
!2# /ccounts 9eceia3le Contract illings 20,000,000
1(,000,000
!$# Cas; /ccounts 9eceia3le
12,000,000
2008 1(,000,000
1(,000,000
20,000,000 1(,000,000
2(,000,000 12,000,000
2(,000,000 !4# Construction in Progress Cost of Construction Construction 9eenue 16,(00,000
1,000,000 1(,000,000
1,(00,000 1(,000,000 16,000,000
Pro#,e9 10 "
!a#
200" Cost incurred to date P10,000,000
P 1,000,000
P (,(00,000
iide 3) total estimated cost _12,000,000
P %,000,000
P11,000,000
Percentage of Completion
11-11 200"
!3#
2007
(0 2007
Contract Price P1(,000,000 Less Less:: Total otal Est Estim imat ated ed Cos Costt Cost incurred to date 10,000,000 Estimated costs to complete __2,000,000
P1(,000,000
P1(,000,000
1,000,000
(,(00,000
__',000,000
__(,(00,000
Total _12,000,000
__%,000,000
_11,000,000
6,000,000
4,000,000
___11-11
______(0
666,600
2000,000
________*
___666,600
P 66 666,600
P 1,$$$,400
Estimated gross profit $,000,000 Percentage of completion ___'$-$$ Gross profit earned to date %,(00,000 Less: Gross profit earned in prior )rs _2,000,000 Gross profit earned t;is )ear P (00,0 (0 0,000 00 174 10
!c#
2008
'$-$$ 2008
Chapte Cha pterr
!1# Construction in progress !cost incurred# Cas; 1,000,000
1,000,000
!2# /ccounts 9eceia3le Contract illings 1,$2(,000
1,$2(,000
!$# Cas; /ccounts 9eceia3le
1,200,000
1,200,000 !4# Construction in progress !gross profit# Cost of construction Construction 9eenue 1,666,600
666,600 1,000,000
Pro#,e9 10 $
!1#
200(
200"
2007
2008
Contract Price P14,000,000 Less: Less: Total otal Estima Estimated ted Cost Cost Cost incurred to date 1$,%00,000 Estimated cost to complete ________*
P14,000,000
P14,000,000
P14,000,000
6,(00,000
%,'00,000
12,200,000
__6,'00,000
_$,%00,000
_1,%00,000
Total 1$,%00,000
_1$,$00,000
1$,&00,000
14,100,000
Estimated gross profit Percentage of completion ____100
&00,000 ___4'-'&
$00,000 ___&1-($
! 10 100,000# _____100
100,000
Gross profit !loss# to date Less: Gr Gross pr profit !l !loss# in in pri prio or )r )rs! 100,0 100 ,000# 00#
$42,0%0 ________*
214,(%0 ___$42,0%0
! 100,000# ___214,(% ,(%0
100,000
P $4 $42,0%0
P! 12&,(00#
P! $14,(%0#
Gross profit !loss# t;is )ear 200,000 !2#
200(
200"
2007
P
2008
Cost of construction 6,(00,000 $,$00,000 2,400,000 1,&00,000 Construction in progress $42,0%0 12&,(00 $14,(%0 200,000 Construction 9eenue 6,'42,0%0 $,1&2,(00 2,0'(,410 1,%00,000
Pro#,e9 10 %
!1#
200(
200"
P 6,000,000
P 6,000,000
P 6,000,000
$,400,000
(,%(0,000
6,1(0,000
Estimated co costs to to co complete
_2,100,000
___1(0,000
________*
Total
_(,(00,000
_6,100,000
_6,1(0,000
Estimated gross profit Percentage of completion
(00,000 ___61-'2
! 10 1 00,000# _______*
! 1( 1 (0,000# ________*
Gross profit !loss# to date Gross profit !loss# in prior )rs-
$0%,100 ________*
! 100,000# __$0%,100
! 1(0,000# ! 100,000#
Gross profit !loss# t;is )ear
P $0%,100
P 40%,100
P
Contract Price Less Less:: Total otal est estim imat ated ed cos costs ts Cost incurred to date
2007
(0,000
Long-Term Construction Const ruction Contrac C ontracts ts 175
!2#
200( Cost of construction Construction in progress (0,000 Construction 9eenue 1(0,000
!$#
C Caas; /ccounts 9eceia3le Contract illings Construction in progress
200"
$,400,000 $0%,100
2007
2,((0,000
200,000 40%,100
$,&0%,100
2,140,%00
400,000 400,000 6,000,000 6,000,000 Pro#,e9 10 &
!1#
200" Contract Price Less:Total Estimated Cost Cost incurred to date Estimated co costs to complete
2007
2008
P16,000,000
P16,000,000
P16,000,000
4,600,000 __%,640,000
%,100,000 __(,100,000
14,$(0,000 _________*
_14,240,000
_14,200,000
_14,$(0,000
1,&60,000 ______$1
1,'00,000 ______('
1,6(0,000 _____100
Gross profit to date (4(,600 Less: Gross profit earned in prior )rs- ________*
1,044,000 __(4(,600
1,6(0,000 _1,044,00 ,000
Gross profit earned t;is )r-
P 4% 4%',410
P 60 6 06,000
Total Estimated gross profit EngineerAs estimate of comp-
!2# !a# Construction on progress Cas; (,2(0,000
P (4 ( 4(,600 200" 4,600,000
2007 4,(00,000 4,600,000
!3# /ccounts receia3le Contract 3illings (,000,000
(,000,000
!c# Ca Cas; /ccounts receia3le 6,100,000
4,(00,000
2008 (,2(0,000 4,(00,000
6,000,000 (,000,000
(,000,000 6,000,000
(,400,000 4,(00,000
6,100,000 (,400,000
!d# Cost of constructions 4,600,000 4,(00,000 (,2(0,000 Construction in progress (4(,600 4%',400 606,000 Construction reenue (,14(,600 4,%%',400 (,'(6,000 !e# Contract 3illings 16,000,000 Construction on progress
16,000,000 !$# .ero Profit Method: 200 +ntres !a# Co C onstruction in progress Cas; " accounts pa)a3le
(,2(0,000 (,2(0,000
!3# /ccounts receia3le Contract 3illings
(,000,000 (,000,000
176 Chapter 10
!c# Cas; /ccounts receia3le
6,100,000
!d# Cost of construction Construction in progress Construction reenue
(,2(0,000 1,6(0,000
6,100,000
6,%00,000
!e# Contract 3illings Construction in progress !4#
16,000,000 16,000,000
T;e folloB folloBing ing entr) entr) Bould Bould 3e t;e onl) onl) one one differe different nt from from !2#!2#-
Cost of construction Construction in progress Construction reenue 6,&20,000
200" 2007 2008 4,414,400 $,'21,600 6,114,000 (4(,600 4%',400 606,000 4,%60,000 4,$20,000
Total estimated estimated costs costs > estimated estimated percentag percentagee of completio completionn-
Pro#,e9 10 '
!1#
200" Contract Price P6,(00,000 Less:Total Estimated Costs Cost incurred to date 6,'(0,000 Estimated costs to complete ________* Total _6,'(0,000 Estimated gross profit !loss# !$(0,000# Less: Gross profit !loss# in prior )rs _!2(0,000# Gross profit !loss# t;is )ears P! 600,0 600 ,000# 00#
2007
P6,(00,000
P6,(00,000
2,1(0,000
(,2(0,000
_$,'(0,000
_1,(00,000
_6,000,000
_6,&(0,000
(00,000
!2(0,000#
________*
___(20,000
P (20,000
P! 2(0,000#
2008
!2#
n 200' 200' B;en B;en t;e t;e proD proDect ect is comp complet leted ed--
