Answer:
revenue recognized
-
2021 = $3,000,000
-
2022 = $4,700,000
-
2023 = $2,300,000
gross profit
-
2021 = $420,000
-
2022 = $658,000
-
2023 = $124,200
Explanation:
Percentage of 2021 2022 2023
completion method
Cost incurred in $0 $2,580,000 $6,622,000
previous year
+ Cost incurred $2,580,000 $4.042,000 $2,175,800
during the year
Total cost incurred $2,580,000 $6,622,000 $8,797,800
+ Estimated cost to $6,020,000 $1,978,000 $0
be incurred
Total estimated cost $8,600,000 $8,600,000 $8,797,800
to be incurred
Percentage of 30% 77% 100%
completion
Total revenue $10,000,000 $10,000,000 $10,000,000
Total revenue $3,000,000 $7,700,000 $10,000,000
recognized (% of completion x total revenue)
- Revenue recognized ($0) ($3,000,000) ($7,200,000)
in previous year
= revenue recognized $3,000,000 $4,700,000 $2,300,000
in current year
gain/loss 2021 2022 2023
Revenue $3,000,000 $4,700,000 $2,300,000
- Cost incurred ($2,580,000) ($4,042,000) ($2,175,800)
Gross profit $420,000 $658,000 $124,200
