Question

In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows: during the year $2,100,000 $2,450,000 $2,695,000 Estimated costs to complete as of year-end Billings during the year Cash collections during the year 4,900,000 2,450,000 2,200,000 2,350,000 5,450,000 1,900,000 2,300,000 5, 800,000 3 28 Westgate recognizes revenue over time according to percentage of completion Required: ances 1. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years. 2-a. In the journal below, complete the necessary journal entries for the year 2018 (credit "Various accounts" for construction costs incurred). 2-b. In the journal below, complete the necessary journal entries for the year 2019 (credit "Various accounts" for construction costs incurred). 2-c. In the journal below, complete the necessary journal entries for the year 2020 (credit "Various accounts" for construction costs incurred). 3. Complete the information required below to prepare a partial balance sheet for 2018 and 2019 showing any items related to the the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. 2018 2019 2020 Prev 12 of 13 Next

Answer 1