In 2013, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for
Question
In 2013, 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 2015. Information related to the contract is as follows:
| 2013 | 2014 | 2015 | |||||||
| Cost incurred during the year | $ | 3,344,000 | $ | 3,960,000 | $ | 1,645,600 | |||
| Estimated costs to complete as of year-end | 5,456,000 | 1,496,000 | 0 | ||||||
| Billings during the year | 2,800,000 | 4,504,000 | 2,696,000 | ||||||
| Cash collections during the year | 2,520,000 | 4,400,000 | 3,080,000 |
| Westgate uses the percentage-of-completion method of accounting for long-term construction contracts. In the journal below, complete the necessary journal entries for the year 2013 (credit various accounts for construction costs incurred). (If no entry is required for a particular transaction, select “No journal entry required” in the first account field. Do not round intermediate calculations.) Record construction cost.Record the gross profit. In the journal below, complete the necessary journal entries for the year 2014 (credit various accounts for construction costs incurred). (If no entry is required for a particular transaction, select “No journal entry required” in the first account field. Do not round intermediate calculations.) Record construction cost.Record progress billingsRecord cash collectionsRecord gross profit In the journal below, complete the necessary journal entries for the year 2015 (credit various accounts for construction costs incurred). (If no entry is required for a particular transaction, select “No journal entry required” in the first account field. Do not round intermediate calculations.)Record construction cost.Record progress billingsRecord cash collectionsRecord gross profit Complete the information required below to prepare a partial balance sheet for 2013 and 2014 showing any items related to the contract. (Do not round intermediate calculations.) |
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