Ismail Construction enters into a contract to build a 5 story office building. Ismail is responsible for the overall management of the project, engineering, site clearance, foundation, and construction of the building. How many performance obligations are in this contract? Explain your answer.
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Ismail Construction enters into a contract to build a 5 story office building. Ismail is responsible for the overall management of the project, engineering, site clearance, foundation, and construction of the building.
How many performance obligations are in this contract? Explain your answer.
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- Richardson Custom Homes enters into a contract to build a house for a the Beckham family. Richardson Custom Homes is responsible for the overall management of the project and identifies various goods and services that will be completed including construction of the home, plumbing and electrical services, painting, and carpentry. How many performance obligations are in this contract? Explain your answer.On November 1, 2021 Martinez Home Remodeling enters into a contract to "finish" a customer's basement. The project includes installing electrical, drywall, painting, and carpeting. How many performance obligations are in this contract? Question 22 options: a) 1 b) 2 c) 3 d) 4Jorg is building an office building for Wilmington Company for $20,000,000. The contract has the following characteristics: • The office building is built to the customer’s specifications and the customer can make changes to these specifications over the contract term. • Progress payments are made by the customer throughout construction. • The customer can cancel the contract at any time (with a termination penalty); any work in process is the property of the customer. Jorg provides you with the following details: December 31 Year 1 Year 2 Year 3 Costs incurred to date $8,000,000 $16,000,000 $18,000,000 Estimated costs to complete 6,000,000 3,000,000 — Billings to date 8,000,000 16,000,000 20,000,000 Collections to date 6,000,000 12,000,000 18,000,000 Prepare journal entries on December 31 for all 3 years. 1. to record costs of construction for cash. 2. to record partial billings. 3. to record collections on account. 4. to record…
- Hillside Company enters into a contract with Sanchez Inc. to provide a software license and 3 years of customer support. The customer-support services require specialized knowledge that only Hillside Company's employees can perform. How many performance obligations are in the contract?Jorg is building an office building for Wilmington Company for $20,000,000. The contract has the following characteristics: • The office building is built to the customer’s specifications and the customer can make changes to these specifications over the contract term. • Progress payments are made by the customer throughout construction. • The customer can cancel the contract at any time (with a termination penalty); any work in process is the property of the customer. Jorg provides you with the following details: December 31 2019 2020 2021 Costs incurred to date $8,000,000 $16,000,000 $18,000,000 Estimated costs to complete 6,000,000 3,000,000 — Billings to date 8,000,000 16,000,000 20,000,000 Collections to date 6,000,000 12,000,000 18,000,000 Required: 1. Calculate the estimated total gross profit on the contract as of December 31, 2019, 2020, and 2021. 2. Calculate the percentage of completion for 2019, 2020, and 2021. 3.…A Contractor submitted its Progress Billing No. 1 to the Project's Owner. Under the contract as well as relevant applicable regulations, the Owner has 30 days within which to pay the Contractor said Progress Billing. The Owner was able to pay the Contractor 14 Calendar Days after the deadline. How much can the Owner be required to pay to pay, inclusive of interest incurred? Explain Fully.
- JUBAIL BUILDERS is constructing a multi-unit residential complex. In the prior year, JUBAIL BUILDERS entered into a contract with a customer for a specific unit that is under construction. JUBAIL has determined that the contract is a single performance obligation satisfied over time. JUBAIL BUILDERS gathered the following information for the contract during the year. JUBAIL BUILDERS-Year Ended December 31, 2018: Costs to date 10,500,000 Future expected costs 7,000,000 Work certified to date 12,600,000 Expected Sales value 22,400,000 Revenue taken in earlier period 8,400,000 Costs taken in earlier periods 6,650,000 Calculate the amounts to be included in the statement of profit or loss in respect of revenue and costs for the year ended December 31, 2018 on both methods (I) Input Method (cost basis), and (II) Output Method (Sales Basis) Calculate the total expected profit for the year 2018?Construction Contract: Graded Question #1: George Co. enters into a contract to build an apartment for Jungle Co. for a fixed fee of P20,000,000. At contract inception, George Co. assesses its performance obligations in the contract and concludes that it has a single performance obligation that is satisfied over time. George Co. determines that the measure of progress best depicts its performance in the contract is input method based on costs incurred. George estimates that the total contract costs would amount to P16,000,000 over the construction period. George incurs contract costs of P2,000,000 during the year. How much revenue is recognized for the year?George Co. enters into a contract to build an apartment for Jungle Co. For a fixed fee of P20,000,000. At contract inception, George Co. assesses its performance obligations in the contract and concludes that it has a single performance obligation that is satisfied over time. George Co. determines that the measure of progress that best depicts its performance in the contract is input method based on costs incurred. George estimates that the total contract costs would amount to P16,000.000 over the construction period. George incurs contract costs of P2,000,000 during the year. How much revenue is recognized for the year?
- Nance Network Consultants, Incorporated uses the percentage-of-completion method to account for its long-term contracts. It uses the cost-to-cost approach to measure progress. During the current year, Nance signed a contract to develop a computer network for an international accounting firm. Information related to the contract follows. Prepare the t-accounts for construction in progress, billings on construction in progress, and accounts receivable. Determine the net asset (liability) for each year of the contract on December 31.1. In 20x1, Electrified Construction Co. enters into a contract to construct a building for a customer. Electrified identifies its performance obligation to be satisfied over time. Electrified measures its progress on the contract based on costs incurred. The contract price is P20M. Electrified has an unconditional right to all billings made in accordance with the billing schedule stated in the contract. Information on the construction is as follows: 20x1 20x2 20x3 a. contract cost incurred per yr. 8,160,000 7,320,000 1,920,000 b. billings per year 10,000,000 7,000,000 3,000,000 c. collections on billings per year 9,500,000 6,650,000 3,850,000 d. estimated costs to complete 8,840,000 1,720,000 (at each yr. end) a. Compute for the gross profits, revenues and costs of construction in 20x1, 20x2 and 20x3, respectively. b. Provide the journal entries under (i) traditional accounting and (ii) PFRS…In 20x1, ABC Co. enters into a contract to construct a building for a customer. ABC identifies its performance obligation to be satisfied over time. ABC measures its progress on the contract based on costs incurred. The contract price is P20,000,000. ABC has an unconditional right to all billings made in accordance with the billing schedule stated in the contract. Information on the construction is as follows: 20x1 20x2 20x3 Contract costs incurred per year Billings per year Collections on billings per year 1,920,000 3,000,000 5,650,000 3,850,000 8,160,000 7,320,000 10,000,000 500,000 6600,000 Estimated costs to complete (at each year-end) from the Student Ha8,840,000 1,720,000 ons, quizzes rection with any academic work, abetting of the same: 1st violation How much profit is recognized on the contract in 20x3?