Star Construction Corp. has a contract to construct a building for $10,876,000. The building is controlled by the customer throughoutthe term of the contract. Total costs to complete the building were originally estimated at $8,801,600. Construction commenced on 4February 20X5. Actual costs were in line with estimated costs for 20X5 and 20X6. In 20X7, actual costs exceeded estimated costs by$138,400.Total construction costs incurred in each year were as follows:20X520X620X7Billings (and cash collections) each year were as follows:20X520X620X7$2,682,000$4,470,000$1,788,00020X520X620X7Total$2,284,500$4,867,000$3,724,500Required:1. Calculate the revenues and gross profit for the construction project for each of the three years assuming the company uses inputs tomeasure progress. (Round intermediate calculations to 2 decimal places. Round final answers to nearest whole dollars.)YearRevenue Gross Profit$ 3,311,082 $ 629,0825,048,536578,5363,206,4641,418,464$ 11,566,082 $2,626,082

The percentage of completion method is an accounting technique used to recognize revenue and…

Star Construction Corp. has a contract to construct a building for $10,876,000. The building is controlled by the customer throughout the term of the contract. Total costs to complete the building were originally estimated at $8,801,600. Construction commenced on 4 February 20X5. Actual costs were in line with estimated costs for 20X5 and 20X6. In 20X7, actual costs exceeded estimated costs by $138,400. Total construction costs incurred in each year were as follows: 20x5 20x6 20x7 $2,682,000 $4,470,000 $1,788,000 Billings (and cash collections) each year were as follows: 20x5 20X6 20x7 $2,284,500 $4,867,000 $3,724,500 Required: 1. Calculate the revenues and gross profit for the construction project for each of the three years assuming the company uses inputs to measure progress. (Round intermediate calculations to 2 decimal places. Round final answers to nearest whole dollars.)

Star Construction Corp. has a contract to construct a building for $10,876,000. The building is controlled by the customer throughout the term of the contract. Total costs to complete the building were originally estimated at $8,801,600. Construction commenced on 4 February 20X5. Actual costs were in line with estimated costs for 20X5 and 20X6. In 20X7, actual costs exceeded estimated costs by $138,400. Total construction costs incurred in each year were as follows: 20x5 20x6 20x7 $2,682,000 $4,470,000 $1,788,000 Billings (and cash collections) each year were as follows: 20x5 20X6 20x7 $2,284,500 $4,867,000 $3,724,500 Required: 1. Calculate the revenues and gross profit for the construction project for each of the three years assuming the company uses inputs to measure progress. (Round intermediate calculations to 2 decimal places. Round final answers to nearest whole dollars.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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