Prepare the journal entries for 2023. (Use Materials, Cash, Payables for costs incurred to date.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts. List all debit entries before credit entries.)
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Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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- Sandhill Enterprises Ltd. has entered into a contract beginning in February 2023 to build two warehouses for Tamarisk Structures Ltd. The contract is a non-cancellable fixed-price contract for $9.2 million. The following data pertain to the construction period (all figures in thousands). Costs for the year Estimated costs to complete Progress billings for the year (non-refundable) Cash collected for the year (a) Percent complete Save for Later 2023 2024 2025 $3,645 4,455 800 4,455 900 3,320 2,925 Using the percentage-of-completion method, calculate the percentage complete for each year of the contract. (Round answers to 0 decimal places, eg. 52%) 2023 -0. 3,880 2,000 3,930 2,345 2024 2025 Attempts: 0 of 1 used Submit Answer (b) The parts of this question must be completed in order. This part will be available when you complete the part above. % (c1) The parts of this question must be completed in order. This part will be available when you complete the part above. (c2) The parts of…Rogers Ltd. has entered into a contract beginning in February 2020 to build two warehouses for ocean Ltd. The contract is a non-cancellable fixed price contract for $9.4 million. The following data pertain to the construction period. 2020 2021 2022 Costs for the year $3,285,000 4,015,000 1,800,000 Estimated costs to complete 4,015,000 1,825,000 -0- Progress billings for the year (non-refundable) 2,960,000 3,440,000 3,000,000 Cash collected for the year 2,605,000 3,490,000 3,305,000 a) Using the percentage-of-completion method, calculate the percent complete for each year of the contract. b) Calculate the amount of the gross profit to be recognized each year of the contract. c) Prepare the journal entries for 2020 and 2021. (Use Materials, Cash, Payables for costs incurred to date.) d) What is the balance in the Contract Asset/Liability account at December 31, 2020 and 2021? Show how the construction contract would be reported on the SFP…Oriole Enterprises Ltd. has entered into a contract beginning in February 2023 to build two warehouses for Whispering Winds Structures Ltd. The contract is a non-cancellable fixed-price contract for $9.7 million. The following data pertain to the construction period (all figures in thousands). Costs for the year Estimated costs to complete Progress billings for the year (non-refundable) Cash collected for the year (a) Your answer is incorrect. Percent complete 2023 2023 0 2024 $3,420 4,180 3,095 3,605 3,000 2,725 3,655 3,320 % 2025 Using the percentage-of-completion method, calculate the percentage complete for each year of the contract. (Round answers to O decimal places, e.g. 52%.) 4,180 1,800 1,900 -0- 2024 % 2025 100 %
- Blossom Enterprises Ltd. has entered into a contract beginning in February 2020 to build two warehouses for Atlantis Structures Ltd. The contract is a non-cancellable fixed price contract for $10.0 million. The following data pertain to the construction period (all figures in thousands). Costs for the year Estimated costs to complete Progress billings for the year (non-refundable) Cash collected for the year Gross profit/(loss) $ eTextbook and Media List of Accounts Account Titles and Explanation (To record cost of construction) The construction industry has experienced significant expansion, making construction materials and labour more costly than originally estimated. Blossom finds it extremely difficult to estimate the costs to complete construction and therefore difficult to estimate the percent complete. It must account for the construction project using the zero-profit method. (To record progress billings) Calculate the amount of the gross profit to be recognized each year of…SMC entered into a long-term construction contract for 3 years. Contract price agreed was P4,150,000. The outcome of the contract was estimated reliably. The following data were ascertained for the contract: December 31, 2017 December 31, 2018Percentage of completion 30% 82.5%Estimated cost to complete 1,960,000 840,000 What is the construction cost of sales for year 2018?A. 3,960,000 C. 3,233,750B. 3,120,000 D. 4,478,750SMC entered into a long-term construction contract for 3 years. Contract price agreed was P4,150,000. The outcome of the contract was estimated reliably. The following data were ascertained for the contract: December 31, 2017 December 31, 2018Percentage of completion 30% 82.5%Estimated cost to complete 1,960,000 840,000 1. What is the total cost incurred in year 2018?A. 4,073,750 C. 1,680,000B. 840,000 D. 3,120,000 2. The realized gross profit (loss) in year 2018 isA. 650,000 C. (. 245,000)B. 405,000 D. (1,055,000) 3. What is the construction cost of sales for year 2018?A. 3,960,000 C. 3,233,750B. 3,120,000 D. 4,478,750 4. What is the construction-in-progress as of 2018?A. 3,423,750 C. 2,065,000B. 3,310,000 D. 2,470,000
- The Naples Company uses the percentage-of-completion method and the cost-to-cost method for its long-term construction contracts. On one such contract, Naples expects total revenues of P260,000. During the first year, Naples incurred costs pf P50,000 and billed the customer P30,000 under the contract. At what net amount should Naples Construction in Progress for this contract be reported at the end of the first year? a. P 35,000 b. 65,000On January 1, 2021, Ka Leody Inc. entered into a long-term construction contract with fixed contract price of P 5,000,000. Ka Leody billed its client as follows: 30% during 2021, 40% during 2022 and the remainder at the end of project completion. The following data were provided by the cost accountant of the Ka Leody Inc: 2020 2021 2022 Cumulative cost incurred as of the end of the year P 2,200,000 P 3,600,000 P 4,800,000 Estimated remaining cost to complete at the end of the year P 3,300,000 P 900,000 What is the revenue to be recognized on December 31, 2021 under percentage of completion method ?On February 1, 2023, Sandhill Contractors agreed to construct a building at a contract price of $3,460,000. The total estimated construction costs would be $1,890,000 and the project would be finished in 2025. Information relating to the costs and billings for this contract is as follows: Total costs incurred to date Estimated costs to complete Customer billings to date Collections to date 2023 Gross profit/ (loss) 689,850 1,200,150 1,100,000 1,000,000 2023 2024 573050 $1,162,000 $ 2,365,000 913,000 1,890,000 1,750,000 2025 Calculate the gross profit / (loss) that should be recognized for 2023, 2024, and 2025 using the percentage completion method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round percentage complete to 1 decimal place, e.g. 15.2% and final answers to O decimal places, e.g. 5,125.) 2024 -0- 3,460,000 2,950,000 -107450 $ LA 2025 40450
- In 20x1, XYZ Company enters into a construction contract with a customer. The contract price is P10,000,000.Information on the contract follows:20X1 20X2 20X3Contract costs incurred during the year P2,645,132 P236,451 P2,657,000Estimated costs to complete 2,697,451 2,116,777 -Progress Billings 5,000,000 3,000,000 2,000,000Collections on progress billings 2,000,000 4,000,000 4,000,000Using the cost-to-cost method, compute the following: Note: Use up to two (2) decimal places in presenting the answer for percentage of completion. Use six (6)decimal places when applying the percentage.7. Realized gross profit in 20x2 _____________8. The balance of "Contract Liability" at the end of 20x2 _____________9. Revenue that should be recognized in 20x3 _____________10. Realized gross profit in 20x3In 20x1, XYZ Company enters into a construction contract with a customer. The contract price is P10,000,000.Information on the contract follows:20X1 20X2 20X3Contract costs incurred during the year P2,645,132 P236,451 P2,657,000Estimated costs to complete 2,697,451 2,116,777 -Progress Billings 5,000,000 3,000,000 2,000,000Collections on progress billings 2,000,000 4,000,000 4,000,000 Using the cost-to-cost method, Note: Use up to two (2) decimal places in presenting the answer for percentage of completion. Use six (6)decimal places when applying the percentage.1. Percentage of completion for 20x1 _____________2. Revenue that should be recognized in 20x1 _____________3. Realized gross profit in 20x1 _____________4. Balance of "Contract Liability" at the end of 20x1 _____________In 20x1, XYZ Company enters into a construction contract with a customer. The contract price is P10,000,000.Information on the contract follows:20X1 20X2 20X3Contract costs incurred during the year P2,645,132 P236,451 P2,657,000Estimated costs to complete 2,697,451 2,116,777 -Progress Billings 5,000,000 3,000,000 2,000,000Collections on progress billings 2,000,000 4,000,000 4,000,000 Using the cost-to-cost method, compute the following: Note: Use up to two (2) decimal places in presenting the answer for percentage of completion. Use six (6)decimal places when applying the percentage.4. Balance of "Contract Liability" at the end of 20x1 _____________5. Percentage of completion for 20x2 _____________6. Revenue that should be recognized in 20x2 _____________